Markets & Finance

Movers: MBIA, Fannie Mae, Williams-Sonoma, Tiffany


Stocks in the news Thursday

From Standard & Poor's Equity ResearchMBIA Inc. (MBI) announces that its insurance subsidiary, MBIA Insurance Corp., has agreed to reinsure a portfolio of U.S. public finance bonds insured by Financial Guaranty Insurance Company with total net par outstanding estimated to be approximately $184 billion as of Sept. 30, 2008. MBIA will receive unearned upfront premiums, net of a ceding commission paid to FGIC, of about $741 million in connection with the reinsurance.

Fannie Mae (FNM) CEO Dan Mudd announces series of senior executive appointments, effective immediately, to oversee and implement the company's recently announced capital management and credit loss reduction plan. Names David Hisey as CFO (replacing Stephen Swad), Peter Niculescu as Chief Business Officer (replacing Robert Levin, who is retiring), and Michael Shaw as Chief Risk Officer (replacing Enrico Dallavecchia).

Williams-Sonoma (WSM) posts $0.08, vs. $0.23 a year ago, second quarter non-GAAP EPS on 12% lower same-store sales (SSS), 4.6% lower total sales. Sees 13.5%-15.5% third quarter SSS sales drop vs. previous decline of 6.5%-8.5% decline, $802-$820 million total sales, vs. $869-$887 million sales. Cuts fiscal year 2009 GAAP EPS est. to $1.03-$1.15 from $1.45-$1.58.

Brown-Forman (BF.B) posts $0.73, vs. $0.77, first quarter EPS as a $22 million pre-tax ($16 million after-tax) non-cash charge related to an abnormal number of agave plants identified during the first quarter as dead or dying offsets a 6.9% revenue rise. Due to the charge, reduces fiscal year 2009 EPS guidance to $3.60-$3.85.

Tiffany & Co. (TIF) posts $0.63, vs. $0.29, second quarter EPS on 1% lower same-store sales, 11% higher total sales. Raises $2.80-$2.90 fiscal year 2009 EPS est. to $2.82-$2.92 on worldwide sales growth of approximately 9%, which based on continued strong growth in Europe and Asia-Pacific (other than Japan) and a return to growth in comparable U.S. store sales in the fourth quarter due to an easier year-over-year comparison. Also expects the fiscal year 2009 operating margin to increase slightly over the prior year.

Sears Holdings (SHLD) posts $0.21 (excluding gain), vs. $1.15, second quarter EPS on 6.7% drop in Sears Domestic's same-store sales, 5.6% drop in in Kmart's same-store sales, 4.1% total revenue drop. Notes effects of slowing economy, lower gross margin generated at both Kmart and Sears Domestic. Sees fiscal year 2009 EBITDA comparable to, but no longer exceeding, last year's EBITDA.

Del Monte Foods (DLM) posts $0.04 first quarter loss from continuing operations vs. $0.01 EPS, as higher inflationary and other operational costs offset a 16% rise in sales. Sees fiscal year 2009 EPS from continuing operations at the lower end of its $0.58-$0.62 guidance range, on net sales growth of 6%-8%.

Fred's (FRED) posts $0.03, vs. $0.08 EPS (GAAP), as costs associated with the closing of 50 stores and one pharmacy during the latest quarter offset a 4.9% rise in same-store sales, a 5.0% rise in total sales. Excluding such costs, second quarter EPS was $0.10. For the third quarter, it sees $0.16-$0.18 EPS on 1%-3% higher same-store sales, flat total sales, reflecting the closing of 75 stores and 22 pharmacies in line with FRED's planned restructuring program. For fiscal year 2009, still sees EPS in the range of $0.54-$0.58, including net costs relating to store closings; excluding such costs, sees EPS at $0.72-$0.76.

Genesco (GCO) posts $0.18, vs. breakeven, second quarter adjusted EPS from continuing operations on 4% same-store sales rise, 7.7% total sales rise. Raises fiscal year 2009 EPS guidance to $2.15-$2.20 (excluding merger-related expenses, asset impairment charges, other items).

Zale (ZLC) posts narrower-than-expected $0.15 fourth quarter loss from continuing operations, vs. $0.01 EPS, on 6.1% rise in same-store sales, 6.1% total sales rise. Due to change in the company's warranty programs in fiscal year 2007 (July), management considers non-GAAP total revenues and non-GAAP EPS, both adjusted for total warranty sales, as important metrics in evaluating its current performance. As such, sees fiscal year 2009 EPS of $1.10-$1.25; $2.35-$2.50 after adjustment for total warranty sales.

Open Joint Stock-Vimpel Communications (VIP) posts $0.46, vs. $0.35, second quarter earnings per ADS on 52% revenue rise. Street was looking for $0.61.

Coldwater Creek (CWTR) posts better-than-expected $0.03, vs. $0.09, second quarter EPS on 14% lower same-store sales, 4.8% lower total sales. Sees $0.02-$0.07 third quarter EPS, loss of -$0.01 to $0.10 EPS in the fourth quarter.

H&R Block (HRB) raises quarterly dividend 5.3% to $0.15, payable Oct. 1, to shareholders of record Sept. 10.

Men's Wearhouse (MW) posts $0.72 (adjusted), vs. $1.00, second quarter EPS on 4.2% total sales decline. Same-store sales fell 6.2% at Men's Wearhouse and fell 4.7% at K&G. Sees third quarter adjusted EPS of $0.36-$0.40, fiscal year 2009 adjusted EPS of $1.50-$1.60.

Tivo (TIVO) posts $0.03 second quarter EPS, vs. $0.18 loss, despite 5.3% decline in service and technology revenues. Says subscription acquisition costs (SAC) fell to $135 vs. $758 last year. Adjusted EBITDA $10.6 million compared to a loss of $11.2 million in the year-ago quarter. Sees third quarter service and technology revenues of $49-$51 million, net loss of $7-$9 million, adjusted EBITDA of -$1 million to +$1 million.

Jo-Ann Stores (JAS) posts $0.47 second quarter loss, vs. $0.76 loss, on 3.3% higher same-store sales, 3.7% higher total sales. Says gross margins increased approximately 190 basis points to 47.6% from 45.7% in second quarter fiscal year 2008, due to lower sales of clearance merchandise. Raises $0.75-$0.85 fiscal year 2009 EPS guidance to $0.95-$1.05 on 2%-3.5% same-store sales growth.


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