Markets & Finance

On the Move: Michelin, Vodafone, Munich Re


From Standard & Poor's European MarketScope

Germany

PORSCHE was down €36.00 to €619.00. Development costs will weigh on earnings as Panamera and hybrid engine projects demand pecuniary attention. Unit sales rose 8.5% in first four months of the company's current fiscal year to 25,635. Revenues were 6.7% higher in the period. The company said unit sales are likely to increase in the 2005/06 fiscal year to end-July, but sales of the Cayenne SUV model will slide markedly.

MUNICH RE was down €3.20 to €115.00. Lehman Brothers and HVB placed 6.9 million Munich Re shares, representing some 3% of the company's share capital. The books are closed now, with the shares placed at €116.30 apiece. On the broker front, Morgan Stanley downgraded the company 's stock to equal weight from overweight, taking the target to €125 from €115.

Italy

BULGARI was up €0.40 to €9.13. The stock rallied on talk of a friendly takeover move, domestic sources said.

TELECOM ITALIA was up €0.04 to €2.47. The company 's roadshow in the US is winning the approval of US funds, Finanza & Mercati reported, adding that the FT is about to publish an article where it celebrates the company for offering a fixed line service at the forefront in Europe. Additionally, the company 's chairman and CEO, Marco Tronchetti Provera and Riccardo Ruggiero, have confirmed that 3,500 jobs will be cut in 2006 which will allow cost savings of €170 million - €200 million.

Netherlands

TNT was up €0.46 to €25.45. Lehman Brothers upped its target to &euro25 from €24 and maintained an overweight rating. CSFB raised its target to €25.0 from €23.5 and kept its neutral rating.

PHILIPS (PHG) was down €0.09 to €24.57. The company expects DAP to become a substantially bigger and more valuable division within the company over the next five years. It sees a long-term average annual organic growth rate of about 7%. Separately, the company has been fined €16 million by the French competition regulator for price fixing. Sony (SNE) and Panasonic have also been fined €16 million and €2.4 million, respectively.

Nordics

NOKIA (NOK) was up €0.31 to €15.18. JP Morgan adjusted its EPS forecasts following the company's Capital Markets Day.

ERICSSON was up SEK0.10 to SEK27.90. After the company announced a seven-year deal with 3 in the UK yesterday, ABN Amro raised its target to SEK23.5 from SEK22.0 and lifted its EPS estimate to SEK1.63 from SEK1.57 for 2006 and to SEK1.69 from SEK1.62 for 2007.

Switzerland

CS GROUP was down CHF0.65 to CHF67.85. The company said it expects to realize additional net income benefits of around CHF1.0 billion in 2008 from the creation of an integrated global bank.

United Kingdom

VODAFONE (VOD) was up £0.03 to £1.29. The company 's Japanese unit Vodafone KK posted its largest increase in customers since June 2004 in November, up 57,000 to 15 million.

BRADFORD & BINGLEY was up £0.06 to £3.86. Shares jumped on bid talk Spain's Santander said it had no comment at the moment on market talk that it could be preparing a bid for the company.

HBOS was up £0.19 to £9.25. Lehman Brothers lifted its target price to £10.61 from £10.31 and raised its estimates by 2%, primarily in fee income, which is indicated to be strong across all businesses and not solely in equity type realizations within corporate banking. It rated the stock overweight.

EASYJET was up £0.07 to £3.59. The company said passenger numbers in November rose 8.3% to 2,297,895 with load factor of 80.2% against 81.2% in November 2004.

CARILLION was down £0.15 to £3.01. The company has agreed to buy Mowlem in a cash and share bid of £2.05. Shareholders will receive 0.39 new Carillion shares and £0.82 in cash. The FT noted that the price represents a sharp drop from the £2.25 a share initially sought by Mowlem, but is still a substantial premium to the £1.73 that Mowlem shares were trading at before the approach was made.

France

MICHELIN was down €0.85 to €45.15. Visibility on the company's markets remain limited, Les Echos reported citing chief executive Edouard Michelin. He also said the group would pursue productivity gains by not replacing all retiring workers both in the US and Europe.

AXALTO was up €1.28 to €24.16. The company and Gemplus have agreed to a merger of equals. Gemplus shareholders will receive 2 Axalto shares for every 25 Gemplus shares and a distribution of €0.26 per share. New company Gemalto is expected to have pro-forma 2005 revenues of €1.80 billion.

GEMPLUS was down €0.02 to €2.28 on the news that it is to merge with Axalto.

TOTAL (TOT) was down €1.80 to €216.80. The weekly EIA report showed crude stocks rose 2.72 million barrels last week vs. forecasts for a 2.0 million draw. Meanwhile, gasoline and distillate inventories also increased more than expected, both by 2.74 million barrels. Subsequently, WTI fell off intraday highs. Prepared by Zaida Espana, Valerie Vidal, Michael Sanderson, Mariella Mongio, Alexander Wisch, Holly Cook, Emma Stevenson, Pawan Girglani, Julien Manrique, and Rocio Opazo-Aniotz (Standard & Poor's); Alex Halperin (BusinessWeek Online)


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