Markets & Finance

AIG Agrees to Record $1.6 Billion Settlement


The Wall Street Journal reports that American International Group (AIG) agreed to a record settlement of more than $1.6 billion with the Securities and Exchange Commission and New York officials over alleged accounting improprieties.

Cognizant Tech Solutions(CTSH) shares gained Thursday after the company posted fourth quarter EPS (GAAP basis) of 39 cents, vs. 21 cents one year earlier, on a 49% revenue rise. The company seees 29 cents first quarter GAAP EPS (including the effect of accounting standard FAS 123R) on at least $275 million in revenue and $1.30 GAAP EPS for all of 2006 (including FAS 123R) on at least $1.26 billion in revenue. S&P reiterates hold.

Gateway (GTW) announces the resignation of CEO Wayne Inouye; director Rick Snyder, formerly president and COO, will serve as interim CEO. The company expects to complete the search for a permanent CEO by late summer.

Town & Country Trust (TCT) receives a revised takeover offer of $39.50 per share from Oriole Partnership, which tops competing bids received earlier from Magazine Acquisition and Oriole Partnership.

Delphi Financial Group (DFG) posts 99 cents vs. 86 cents fourth quarter operating earnings per share (EPS) from continuing operations on a 15% revenue rise. It raises its quarterly dividend 11%.

News Corp. (NWS) posts 21 cents vs. 13 cents second quarter EPS from continuing operations on slightly higher revenue. It sees fiscal year 2006 operating income up 12%. Chairman Murdoch reportedly says the company will consider making a bid for the Spanish language media company Univision (UVN).

Akamai (AKAM) shares moved higher after the company reported 16 cents, vs. 10 cents, fourth quarter EPS (GAAP) on a 44% revenue rise. Jefferies upgraded the shares to buy from hold.

Applebee's (APPB) posts 27 cents vs. 30 cents fourth quarter EPS despite slightly higher system-wide same-store sales and 11% higher total sales. It reiterates 2006 guidance: a 2% to 3% increase in system-wide comparables and $1.26 to $1.30 EPS, including stock compensation cost.

Aetna (AET) posts $1.42 vs. 98 cents fourth quarter EPS (including items) on 14% higher total revenue. It raises $5.45 to $5.50 2006 operating EPS guidance to between $5.57 and $5.63 (excluding stock-option expense); it also sees $5.42 to $5.50 2006 EPS (including stock-option expense).

Whole Foods Market (WFMI) posts lower-than-expected 40 cents vs. 34 cents first quarter EPS on a 22% sales rise. It expects fiscal year 2006 EPS growth to be slightly less than its fiscal year 2006 sales growth guidance of between 18% to 21%.

Electronic Data Systems (EDS) posts better-than-expected 25 cents vs. 29 cents fourth quarter EPS (pro forma) despite a slight sales rise. The information technology services provider sees 10 cents to 15 cents first quarter EPS (pro forma) and $1.05 to $1.15 in 2006.


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