Markets & Finance

Alcoa Issues Earnings Warning


Alcoa (AA) shares fell Friday after the company said it sees 27 cents to 31 cents third quarter earnings per share from its continuing operations. The company cited lower aluminum prices and higher input costs, particularly for energy & raw materials, amid seasonal weakness in Europe and automotive markets. Goldman cut the shares to underperform from in-line. S&P keeps its buy opinion.

Oracle (ORCL) shares declined after the database software outfit posted 14 cents vs. 10 cents first quarter earnings per share (non-Generally Accepted Accounting Principles) on a 31% revenue rise. The company posted 10 cents GAAP earnings per share on a 25% revenue rise. Prudential reportedly downgraded the stock to neutral from overweight. on 25% GAAP rev. rise. S&P keeps buy, but trims its target price. Prudential downgrades to neutral.

Lockheed Martin (LMT) raised its quarterly dividend 20% and set a 45 million share buyback plan.

Over the next three years, Goodyear Tire & Rubber (GT) anticipates incurring cash restructuring charges of $150 million to $250 million to reduce its high-cost manufacturing capacity by 8% to 12%. Goodyear also sees increased Asian sourcing and ongoing productivity improvements.

Northwest Pipe(NWPX) said it sees lower-than-expected third quarter results due to Hurricane Katrina, related transportation issues, and delays at some of its key suppliers delaying the receipt of critical raw materials. The company noted that the cost of steel is increasing rapidly.

Starbucks (SBUX) set a 5 million share buyback plan, which is in addition to 7.2 million shares that remain available for repurchase under existing authorizations.

Cytec Industries (CYT) said that direct impact of Hurricane Katrina is expected to reduce pretax earnings per share by 14 cents to 16 cents, excluding recent price increases for oil and natural gas. The company noted that Hurricane Rita is causing disruptions in energy and raw material supplies.

Palm (PALM) posted 35 cents vs. 38 cents first quarter earnings per share (Generally Accepted Accounting Principles) despite a 25% revenue rise. The company sees $435 million to $440 million second quarter revenue, and 38 cents to 43 cents in non-GAAP earnings per share assuming the reversal of deferred tax asset valuation allowance. S&P keeps its hold on the stock.

Verity (VRTY) posted 1 cent vs. 7 cents first quarter earnings per share (Generally Accepted Accounting Principles) on a 2% revenue rise. The company sees second quarter earnings per share of 3 cents to 5 cents. Verity said its Chief Financial Officer Steven Springsteel was named President, but will still report to the Chief Executive Officer Anthony Bettencourt. S&P keeps a strong sell on the stock.

Altera (ALTR) said it received an SEC request for voluntarily supplied information relating to the company's communications with equity analysts and their firms. The company says it is cooperating fully in this matter.

Doral Financial (DRL) said it expects to file an amended 10-K for 2004, including its restated financial statements, by November 10, 2005, and to file its quarterly reports on Form 10-Q for the first three quarters 2005 as soon as practicable thereafter.

CyberSource (CYBS) announced its signed non-binding letter of intent to acquire the assets of CardSystems Solutions. The company noted that due to an earlier data security breach, CardSystems will not be authorized to process credit card transactions.

Darden Restaurants (DRI) said it posted 53 cents vs. 44 cents first quarter earnings per share on a 10% total sales rise. The same-store sales rose 7.4% at Olive Garden and 5.7% at Red Lobster. The company raised its semiannual dividend to 20 cents per share from 4 cents.

Linens'n Things (LIN) said it expects third quarter earnings per share to be approximately breakeven on 10% lower same-store sales. The compapny noted a sharp decline in guest traffic and disappointing response to Back-to-School assortments. Its board is exploring options, including a possible sale.

3Com (COMS) posted 11 cents earnings per share first quarter loss vs. 9 cents loss (including restructuring and amortization) despite a 9.4% sales rise. The company sees $190 million second quarter revenue. S&P reiterated its hold on the stock and narrowed its loss estimate.

New Century Financial (NEW) cut its $8.25 to $9.00 2005 earnings per share guidance to $7.25 to $7.75 on continued compression of operating margin in its mortgage origination business. The company noted that guidance does not reflect the impact of potential weather-related losses in the Gulf Coast region.

Novatel Wireless (NVTL) said it has begun commercial shipments of its Ovation MCU1200, the first model in the Ovation Family of 3G Multimedia Application Consoles to offer voice and 3G data capabilities.

Thor Industries (THO) announced that total recreational vehicle orders month-to-date were $210 million, as many orders came from dealers selling to Hurricane Katrina evacuees.

MSGI Security Solutions (MSGI) said it has begun to install a subway video surveillance system as part of its pilot program for the New York City Police Department.

VSE (VSEC) said it won a $41 million army contract to apply a fuel tank self-sealing system and add-on armor panel kits for the army's tankers.

Global Payments (GPN) posted 77 cents vs. 62 cents first quarter earnings per share on a 17% revenue rise. The company posted 76 cents in Generally Accepted Accounting Principles earnings per share. It raised its fiscal year 2006 revenue guidance to $855 million to $883 million, and its earnings per share to $2.74 to $2.86, excluding restructuring and other items.

JLG Industries (JLG) posted 69 cents vs. 35 cents fourth quarter earnings per share on 34% higher revenue. The company sees fiscal year 2006 earnings per share of $2.15 to $2.25 on 15% to 20% higher sales.

IPC Holdings(IPCR) Based on preliminary analysis of limited initial information available, the company sees the net impact of Hurricane Katrina losses on its third quarter net income of $350 million to $600 million.


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