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Media Digest (4/24/2013) Reuters, WSJ, NYT, FT, Bloomberg

Douglas A. McIntyre — Wed, 24 Apr 2013 10:34:09 +0000

Apple Inc.’s (NASDAQ: AAPL) new dividend will allow management a period to recover earnings growth while offering investors a return. (Reuters)

Amazon.com Inc. (NASDAQ: AMZN) may use its consumer database to target ads. (Reuters)

Nintendo forecasts it will sell nine million Wii U consoles in the fiscal year that ends March 31. (Reuters)

Credit Suisse Group A.G. (NYSE: CS) profits rise, mainly due to cost cuts. (WSJ)

Budget cuts that effect the air traffic control system have begun to cause delays. (WSJ)

Portugal will have a stimulus package in hopes of resurrecting its damaged economy. (WSJ)

J.C. Penney Co. Inc. (NYSE: JCP) hires turnaround firm AlixPartners. (WSJ)

Dell Inc.’s (NASDAQ: DELL) board sets $91.1 million in bonuses to keep management during a period when the company is likely to go private. (WSJ)

FedEx Corp. (NYSE: FDX) renews its contract with the U.S. Postal Service to fly cargo. (WSJ)

Nike Inc. (NYSE: NKE) will offer $1 billion in corporate bonds, and demand is high. (WSJ)

Wal-Mart Stores Inc. (NYSE: WMT) comes to a deal with Warner Bros. to sell tickets for the new “Man of Steel” movie. (NYT)

New data show that business activity has slowed in the United States, Germany and China. (FT)

Lockheed Martin Corp. (NYSE: LMT) says its revenue will drop by $825 million due to defense spending cuts. (FT)

PSA Peugeot Citroen has higher-than-expected revenue because of China. (Bloomberg)

Filed under: 24/7 Wall St. Wire, Press Digest Tagged: AAPL, AMZN, CS, DELL, FDX, JCP, LMT, NKE, WMT

24/7 Wall St. Closing Bell — April 18, 2013: Markets Cool on Jobs, Manufacturing Data

Paul Ausick — Thu, 18 Apr 2013 20:05:32 +0000

U.S. equity markets opened slightly higher this morning following the report on U.S. jobless numbers (more coverage here). In Europe, the only data out today showed that U.K. retail sales fell 0.7%, slightly better than expected. In Asia, house prices in China gained 3.6% in March, pushing Shanghai to a higher close. In the U.S., the leading indicators came in lower than expected (more coverage here) and the Philly Fed index posted a surprisingly low number (more coverage here). The lower open this morning simply continued sliding until the last hour of trading.

The U.S. dollar index is trading down 0.14% today, now at 82.563. The GSCI commodity index is down 1.5% at 600.97. WTI crude oil closed up 1.2% today, at $XX a barrel. Brent crude trades 1.77% at $100.39 a barrel. Natural gas is up 4.8% today at about $4.40 per million BTUs, after the weekly storage report showed a smaller-than-expected build in inventories (more coverage here). Gold settled up 0.7% today at $1,392.50 an ounce.

The unofficial closing bells put the DJIA down more than 79 points to 14,539.14 (-0.54%), the NASDAQ fell more than 38 points (-1.20%) to 3,166.36, and the S&P 500 fell -0.67% or more than 10 points to 1,541.63.

There were a several analyst upgrades and downgrades today, including Qiagen NV (NASDAQ: QGEN) started as ‘sell’ at Citigroup; Potash Corp. of Saskatchewan (NYSE: POT) started as ‘overweight’ at HSBC; HollyFrontier Corp. (NYSE: HFC) raised to ‘buy’ at BofA/Merrill Lynch; American International Group Inc. (NYSE: AIG) started as ‘outperform’ with a price target of $50 at BMO Capital Markets; and FedEx Corp. (NYSE: FDX) cut to ‘underperform’ at RBC Capital Markets.

Earnings reports since markets closed last night resulted in some price moves today, including these as of the last half hour of trading: American Express Co. (NYSE: AXP) is up 1.7% at $65.20 (more coverage here); SanDisk Corp. (NASDAQ: SNDK) is down 6.7% at $52.00 (more coverage here); eBay Inc. (NASDAQ: EBAY) is down 5.6% at $52.98 (more coverage here); Kinder Morgan Inc. (NYSE: KMI) is up 0.4% at $37.95 (more coverage here); AutoNation Inc. (NYSE: AN) is up 1.7% at $43.22 (more coverage here); Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX) is up 0.3% at $28.09; Morgan Stanley (NYSE: MS) is down 4.7% at $20.47 (more coverage here); Nucor Corp. (NYSE: NUE) is down 0.4% at $XX; Peabody Energy Corp. (NYSE: BTU) is up 8.2% at $20.58 (more coal coverage here); PepsiCo Inc. (NYSE: PEP) is up 2.8% at $81.08 after posting a new 52-week high of $83.44 earlier today (more coverage here); Philip Morris International Inc. (NYSE: PM) is down 2.5% at $91.65 (more coverage here); and Verizon Communications Inc. (NYSE: VZ) is up 3% at $51.01 after posting a new 52-week high of $51.67 (more coverage here).

Before markets open tomorrow morning we are scheduled to hear earnings reports from Advanced Micro Devices Inc. (NYSE: AMD), Capital One Financial Corp. (NYSE: COF), Chipotle Mexican Grill Inc. (NYSE: CMG), E*Trade Financial Corp. (NASDAQ: ETFC), Google Inc. (NASDAQ: GOOG), International Business Machines Corp. (NYSE: IBM), General Electric Co. (NYSE: GE), Honeywell International Inc. (NYSE: HON), McDonald’s Corp. (NYSE: MCD), Rockwell Collins Inc. (NYSE: COL), and Schlumberger NV (NYSE: SLB).

Some standouts among heavily traded stocks today include:

Nokia Corp. (NYSE: NOK) is down 12.6% at $3.13. The mobile phone maker posted weak first quarter results. There’s no mercy in the markets. More coverage here.

Rite Aid Corp. (NYSE: RAD) is up 6.2% at $2.39. The drug store chain accepted the resignation of board member Jean Coutu, who has been reducing his group’s stake in the company. More coverage here.

Apple Inc. (NASDAQ: AAPL) is down 2.7% at $392.06. The tech giant’s shares will close below $400 for the first time in more than a year.

Stay tuned for Friday. Fed Governor Jeremy Stein is giving a speech. There are no other events on tomorrow’s schedule.

Filed under: 24/7 Wall St. Wire, HI/LOW, Market Close Tagged: AAPL, AIG, AMD, AN, AXP, BTU, CMG, COF, COL, EBAY, ETFC, FCX, FDX, GE, GOOG, HFC, HON, IBM, KMI, MCD, MS, NOK, NUE, PEP, PM, POT, QGEN, RAD, SLB, SNDK, VZ

Top Analyst Downgrades and Cautious Views from Wall Street

Jon C. Ogg — Thu, 18 Apr 2013 12:40:15 +0000

While investors generally see analysts issuing Buy ratings, it is always interesting to see what happens when Wall St. analysts give stocks to sell or when they have very cautious comments about companies. We review many fresh research calls to find great ideas from value stocks to growth stocks to dividend stocks. We are breaking out the negative analyst calls of Wall St. analysts’ stocks to sell, as well as cautious calls. These are this Wednesday’s top analyst downgrades and cautious research notes from Wall St.

Apache Corp. (NYSE: APA) was downgraded twice on Thursday: cut to Neutral from Overweight by J.P. Morgan and cut to Perform from Outperform by Oppenheimer.

EBay Inc. (NASDAQ: EBAY) was cut to Neutral from Outperform by Macquarie after its earnings report and mixed guidance. Shares are indicated down 3%.

Expeditors International of Washington Inc. (NASDAQ: EXPD) cut to Underperform from Sector Perform at RBC Capital Markets.

FedEx Corp. (NYSE: FDX) cut to Underperform from Sector Perform at RBC Capital Markets.

Huntington Bancshares Inc. (NASDAQ: HBAN) was downgraded to Neutral from Buy at a firm called Compass Point, although that $8 price target still stands out above the $7.01 close on Wednesday and above the $7.55 high in the past 52-week period.

Qiagen N.V. (NASDAQ: QGEN) was initiated with a Sell rating at Citigroup.

There is a macro-market call from Citigroup’s global equities team to watch. The firm is telling customers that it is shifting its allocations to Underweight from a Neutral weighting for U.S. equities. This may seem a bit late if you have been watching our coverage on Japanese markets, but Citigroup is now telling customers that it underestimated the impact of policy changes from the Bank of Japan and it is now raising Japanese equities to Neutral from Underweight. This call feels a bit like a “Thanks for nothing” call.

Filed under: Active Trader, Analyst Calls Tagged: APA, EBAY, EXPD, FDX, HBAN, QGEN

Media Digest (3/22/2013) Reuters, WSJ, NYT, FT, Bloomberg

Douglas A. McIntyre — Fri, 22 Mar 2013 10:38:03 +0000

Cyprus likely to be pushed out of the European Union if it cannot repair its finances enough to get aid. (Reuters)

An Organization for Economic Cooperation and Development (OECD) report on China says growth could average more than 8% a year over the next decade. (Reuters)

Dell Inc. (NASDAQ: DELL) investors Southeastern Asset Management might have joined that planned buyout, but rejected it and fought the bid as too low. (Reuters)

J.P. Morgan Chase & Co. (NYSE: JPM) is the top bank in M&A activity in the first quarter. (Reuters)

Cyprus may restructure its second largest bank and set financial deposit rules as it struggles with its finances. (WSJ)

Health insurers report that overhaul of the systems under Obamacare may sharply raise premiums for small businesses. (WSJ)

U.S. officials warn banks over loans that add leverage to troubled companies. (WSJ)

FedEx Corp. (NYSE: FDX) will buy 30 model 757 Boeing Co. (NYSE: BA) planes from United Continental Holdings Inc. (NYSE: UAL). (WSJ)

Samsung makes strong claims on the low end of the smartphone market. (WSJ)

Global sales of Nike Inc. (NYSE: NKE) sports shoes and Cole Haan products push earnings higher by 55%. (WSJ)

China becomes the second largest nation in the world for movie ticket sales. (WSJ)

Europe officials examine Apple Inc.’s (NASDAQ: AAPL) relationships with carriers and whether they blunt competition, with the carriers themselves voicing concern. (NYT)

BlackBerry (NASDAQ: BBRY) to introduce its new Z10 into the U.S. market following mixed reviews. (FT)

Apple will increase customer security via a verification process meant to prevent hacking. (FT)

France stat organization Insee expects the French economy to stay frozen in the first half. (Bloomberg)

Filed under: 24/7 Wall St. Wire, Press Digest Tagged: AAPL, BA, BBRY, DELL, FDX, JPM, NKE, UAL

24/7 Wall St. Closing Bell — March 21, 2013: Markets Slide on Europe Fears (FDX, WSM, YHOO, BKW, HON, ORCL, JBL, TUMI, KBH, LULU, MOV, ROST, MU, NKE, SLW, VRNG, DRI, TIF, AFFY, ACAD)

Paul Ausick — Thu, 21 Mar 2013 20:04:54 +0000

U.S. equity markets opened lower this morning and trailed slowly downward all day. The situation in Cyprus was unchanged this morning (more coverage here). In Europe, both manufacturing and non-manufacturing PMI fell short of expectations in Germany and France, weighing down equity futures in the U.S. and trading in Europe (more coverage here). Spain’s trade deficit came in much worse than expected and U.K. retail sales were higher than expectations. In Asia, North Korea threatened U.S. military bases in Okinawa and Guam (more coverage here). Japan’s trade deficit hit a record and China’s PMI rose more than expected. In the U.S., new claims for unemployment benefits were lower than expected (more coverage here), while the Philly Fed survey came in higher than forecast and the leading indicators were reported inline (more coverage here). Existing home sales rose in February (more coverage here).

The U.S. dollar index fell 0.01% today, now at 82.761. The GSCI commodity index is up 1% at 648.70, with commodities prices mostly higher again today. WTI crude oil closed down 1.1% today, at $92.45 a barrel. Brent crude trades down 1.2% at $107.43 a barrel. Natural gas is down 0.7% today at about $3.93 per million BTUs after a smaller than expected draw on inventories last week (more coverage here). Gold settled up 0.4% today at $1,613.80 an ounce.

The unofficial closing bells put the DJIA more than 90 points to 14,421.34 (-0.62%), the NASDAQ fell nearly 32 points (-0.97%) to 3,222.60, and the S&P 500 fell -0.83% or nearly 13 points to 1,545.81.

There were a several analyst upgrades and downgrades today, including FedEx Corp. (NYSE: FDX) reiterated as ‘buy’ and price target raised to $115 at Argus; Williams-Sonoma Inc. (NYSE: WSM) cut to ‘hold’ at Deutsche Bank; Yahoo! Inc. (NASDAQ: YHOO) raised to ‘outperform’ with a price target of $27 at Oppenheimer; Burger King Worldwide Inc. (NYSE: BKW) cut to ‘underperform’ at BofA/Merrill Lynch; and Honeywell International Inc. (NYSE: HON) started as ‘buy’ at Goldman Sachs.

Earnings reports since markets closed last night resulted in several price moves today, including these: Jabil Circuit Inc. (NYSE: JBL) is down 4.6% at $18.58; Tumi Holdings Inc. (NYSE: TUMI) is down 0.6% at $23.71; KB Home (NYSE: KBH) is up 3.4% at $22.30 after posting a new 52-week high of $22.38 earlier today (more coverage here); Lululemon Athletica Inc. (NASDAQ: LULU) is up 1.4% at $64.77 (more coverage here); Movado Group Inc. (NYSE: MOV) is down 10.5% at $33.21; and Ross Stores Inc. (NASDAQ: ROST) is up 3.6% at $58.18.

Before markets open tomorrow morning we are scheduled to hear from Micron Technology Inc. (NASDAQ: MU), Nike Inc. (NYSE: NKE), Silver Wheaton Corp. (NYSE: SLW), Vringo Inc. (NASDAQ: VRNG), Darden Restaurants Inc. (NYSE: DRI), and Tiffany & Co. (NYSE: TIF).

Some standouts among heavily traded stocks today include:

Oracle Corp. (NASDAQ: ORCL) is down 9.3% at $32.45. The software company’s results came in below expectations and the forecast wasn’t so hot either.

Affymax Inc. (NASDAQ: AFFY) is up 17.3% at $1.48. The drugmaker’s stock was pounded earlier this week when it cut 75% of its workforce. The stock has risen from the dead in the last two days, gaining back a good portion of the 60% hit it took.

ACADIA Pharmaceuticals Inc. (NASDAQ: ACAD) is up 23.6% at $8.22 after posting a new 52-week high of $8.81 earlier today. The development stage biopharmaceutical firm reported good data from a trial of its psychosis treatment.

Stay tuned for Friday. Fed Governor Sarah Bloom Raskin is giving a breakfast speech. We have not other events on tomorrow’s schedule.

Filed under: 24/7 Wall St. Wire, HI/LOW, Market Close Tagged: ACAD, AFFY, BKW, DRI, FDX, HON, JBL, KBH, LULU, MOV, MU, NKE, ORCL, ROST, SLW, TIF, TUMI, VRNG, WSM, YHOO

Top Analyst Upgrades and Downgrades (BKW, DOV, FDX, HON, ITW, INTC, IFF, LM, LIFE, MMM, ORCL, WSM, WETF, YHOO)

Jon C. Ogg — Thu, 21 Mar 2013 12:25:39 +0000

Investors and traders seem to constantly look for new good research-driven ideas for stocks to buy and for stocks to sell. Some of these come from independent research firms and some come from the large sell-side investment banking firms on Wall St. These are some of this Thursday’s top analyst upgrades, downgrades and initiations seen from select Wall St. research calls.

Burger King Worldwide Inc. (NYSE: BKW) cut to Underperform at BofA/Merrill Lynch.

Dover Corp. (NYSE: DOV) started on the Conviction Buy List at Goldman Sachs.

FedEx Corp. (NYSE: FDX) reiterated Buy and raised target to $115 at Argus.

Honeywell International Inc. (NYSE: HON) started as Buy at Goldman Sachs.

Illinois Tool Works Inc. (NYSE: ITW) started at Neutral at Goldman Sachs.

Intel Corp. (NASDAQ: INTC) reiterated Buy with $25 target at Argus.

International Flavors & Fragrances Inc. (NYSE: IFF) raised to Buy at Argus.

Legg Mason Inc. (NYSE: LM) raised to Outperform at Wells Fargo.

Life Technologies Inc. (NASDAQ: LIFE) cut to Neutral at Cowen.

3M Co. (NYSE: MMM) started as Neutral at Goldman Sachs.

Oracle Corp. (NASDAQ: ORCL) cut to Underperform at CLSA, cut to Equal Weight at Evercore and maintained Outperform with $40 target at Credit Suisse.

Williams-Sonoma Inc. (NYSE: WSM) cut to Hold at Deutsche Bank.

Wisdom Tree Investments Inc. (NASDAQ: WETF) maintained Buy but removed from the prized Conviction Buy List at Goldman Sachs.

Yahoo! Inc. (NASDAQ: YHOO) raised to Outperform with $27 target at Oppenheimer.

Here are six potentially overvalued DJIA stocks with the market at new highs.

Credit Suisse has released its list of MLPs that it thinks you should buy.

Here are eight stocks that UBS says have outperformed the market that likely will keep outperforming the market.

Filed under: Active Trader, Analyst Calls Tagged: BKW, DOV, FDX, HON, IFF, INTC, ITW, LIFE, LM, MMM, ORCL, WETF, WSM, YHOO

Media Digest (3/21/2013) Reuters, WSJ, FT, Bloomberg

Douglas A. McIntyre — Thu, 21 Mar 2013 10:46:05 +0000

China’s PMI rises, but the improvement is unimpressive. (Reuters)

Cyprus will keep banks closed and may nationalize pension funds. (Reuters)

The Fed will hold interest rates as they are, as Bernanke’s worry about jobs continues. (Reuters)

Blackstone Group L.P. (NYSE: BX) may have approached Mark Hurd, president of Oracle Corp. (NASDAQ: ORCL), about taking over as CEO of Dell Inc. (NASDAQ: DELL). (Reuters)

A hacking attack on South Korea shows how powerful cyber experts in North Korea are. (Reuters)

Google Inc. (NASDAQ: GOOG) says YouTube has one billion active users. (Reuters)

A drop in FedEx Corp. (NYSE: FDX) profits signals that parts of the global economy have not yet recovered. (WSJ)

A slowing in Oracle’s sales pushes down its share price. (WSJ)

Intertrust Technologies sues Apple Inc. (NASDAQ: AAPL) over patent violations. (WSJ)

The U.K. government sharply cuts its GDP growth forecast while staying with austerity plans. (WSJ)

A new challenge for Boeing Co. (NYSE: BA) is to convince passengers its 787 is safe. (WSJ)

U.S. bans keep BP PLC (NYSE: BP) out of bids for Gulf drilling. (FT)

Austerity cuts wages enough in some troubled European Union nations that their workforces have become competitive with those of other nations. (Bloomberg)

Filed under: 24/7 Wall St. Wire, Press Digest Tagged: AAPL, BA, BP, BX, DELL, FDX, GOOG, ORCL

24/7 Wall St. Closing Bell — March 20, 2013: Markets Open Higher, Hold Gains on FOMC Statement (ZNGA, DE, BBY, AAPL, BBRY, ADBE, CTAS, FTEK, WSM, FDX, GIS, LEN, ORCL, JBL, TUMI, KBH, LULU, MOV, ROST, OMPI, VRX, AFFY)

Paul Ausick — Wed, 20 Mar 2013 20:10:43 +0000

U.S. equity markets opened higher this morning and maintained the upside, anticipating that today’s FOMC statement would not provoke any surprises. And the markets were not surprised (more coverage here). In Europe, the Cypriot parliament’s rejection of the levy on deposits led to another flurry of reports, leaks, and opinions on what it all means. In his budget message, the U.K.’s Chancellor of the Exchequer said the British economy is getting better, but the government has cut the GDP growth forecast from 1.2% to 0.6% for 2013. No major data or news from Asia today.

The U.S. dollar index fell 0.34% today, now at 82.729. The GSCI commodity index is down 1.1% at 643.16, with commodities prices mostly higher today. WTI crude oil closed up 0.9% today, at $92.96 a barrel to close the April contract, after the EIA reported a surprise drop in crude supplies (more coverage here). May futures were up 1.1% at $93.50 a barrel. Brent crude trades up 1.3% at $108.79 a barrel. Natural gas is down 0.5% today at about $3.95 per million BTUs. Gold settled up 0.4% today at $1,611.30 an ounce.

The unofficial closing bells put the DJIA up about 56 points to 14,511.73 (0.39%), the NASDAQ rose about 25 points (0.78%) to 3,254.19, and the S&P 500 rose 0.67% or more than 10 points to 1,558.71.

There were a several analyst upgrades and downgrades today, including Zynga Inc. (NASDAQ: ZNGA) cut to ‘neutral’ at BofA/Merrill Lynch; Deere & Co. (NYSE: DE) cut to ‘underperform’ at Wells Fargo; Best Buy Co. Inc. (NYSE: BBY) reinstated as ‘outperform’ with a price target of $30 at Credit Suisse; Apple Inc. (NASDAQ: AAPL) reiterated as ‘outperform’ with a price target of $600 at Credit Suisse; and BlackBerry (NASDAQ: BBRY) raised to ‘overweight’ at Morgan Stanley (more coverage here).

Earnings reports since markets closed last night resulted in several price moves today, including these: Adobe Systems Inc. (NASDAQ: ADBE) is up 4.1% at $42.40 after posting a new 52-week high of $43.23 earlier today; Cintas Corp. (NASDAQ: CTAS)is down 5.6% at $43.37; Fuel Tech Inc. (NASDAQ: FTEK) is down 5.2% at $4.24; Williams-Sonoma Inc. (NYSE: WSM) is up 10.5% at $49.94 after posting a new 52-week high of $50.49 earlier today; FedEx Corp. (NYSE: FDX) is down 7% at $99.05 (more coverage here); General Mills Inc. (NYSE: GIS) is up 2.8% at $47.72 after posting a new 52-week high of $48.02 earlier today (more coverage here); and Lennar Corp. (NYSE: LEN) is up 5.8% at $43.81 after posting a new 52-week high of $43.89 earlier today (more coverage here).

Before markets open tomorrow morning we are scheduled to hear from Oracle Corp. (NASDAQ: ORCL), Jabil Circuit Inc. (NYSE: JBL), Tumi Holdings Inc. (NYSE: TUMI), KB Home (NYSE: KBH), Lululemon Athletica Inc. (NASDAQ: LULU), Movado Group Inc. (NYSE: MOV), and Ross Stores Inc. (NASDAQ: ROST).

Some standouts among heavily traded stocks today include:

BlackBerry (NASDAQ: BBRY) is up 7.9% at $16.22. The smartphone maker got a big upgrade today, just before the new phone becomes available in the U.S. More coverage here.

Obagi Medical Products Inc. (NASDAQ: OMPI) is up 28.1% at $19.72 a new 52-week high. The specialty drug firm is being acquired by Canada’s Valeant Pharmaceuticals International Inc. (NYSE: VRX) for $344 million in cash.

Affymax Inc. (NASDAQ: AFFY) is up 20% at $1.26. The drugmaker’s stock was pounded earlier this week when it cut 75% of its workforce. Today’s rise is likely just an adjustment to a 60%+ loss in response to that announcement.

Stay tuned for Thursday. We have noted the following events on the schedule (all times Eastern):

8:30 a.m. – New claims for unemployment benefits
8:58 a.m. – Flash PMI manufacturing index
9:00 a.m. – FHFA house price index
10:00 a.m. – Existing home sales
10:00 a.m. – Philadelphia Fed survey
10:00 a.m. – Leading indicators
10:30 a.m. – EIA weekly natural gas storage report
1:00 p.m. – Treasury Inflation-Protected Securities (TIPS) auction
4:30 p.m. – Fed balance sheet and money supply

Filed under: 24/7 Wall St. Wire, HI/LOW, Market Close Tagged: AAPL, ADBE, AFFY, BBRY, BBY, CTAS, DE, FDX, FTEK, GIS, JBL, KBH, LEN, LULU, MOV, OMPI, ORCL, ROST, TUMI, VRX, WSM, ZNGA

FedEx Earnings Grounded, Forecast Cut

Paul Ausick — Wed, 20 Mar 2013 12:00:43 +0000

FedEx Corp. (NYSE: FDX) reported fiscal third quarter 2013 results before markets opened this morning. The package delivery service reported adjusted diluted earnings per share (EPS) of $1.23 on revenues of $11 billion. In the same period a year ago, FedEx reported EPS of $1.55 on revenue of $10.6 billion. This morning’s results also compare to the Thomson Reuters consensus estimates for EPS of $1.38 and $10.86 billion in revenue.

On a GAAP basis, EPS totaled $1.13, which excludes employee buyout costs. A year ago the company’s GAAP EPS totaled $1.65, which included a $0.10 benefit.

As a bellwether for the economy, FedEx’s predictive power points to a slowdown. The company’s CEO said:

The third quarter was very challenging due to continued weakness in international air freight markets, pressure on yields due to industry overcapacity and customers selecting less expensive and slower-transit services. In response, beginning April 1, FedEx Express will decrease capacity to and from Asia and will aggressively manage traffic flows to place low yielding traffic in lower-cost networks. We are currently assessing how these actions may allow FedEx Express to retire more of its older, less-efficient aircraft. We remain focused on our strategic cost reduction programs, which are ramping up and on track.

The company saved the worst news for its fourth-quarter outlook. FedEx forecast quarterly EPS at $1.90 to $2.10 and full-year EPS at $6.00 to $6.20. The consensus estimates called for quarterly EPS of $2.13 and full-year EPS of $6.35. The high end of FedEx’s forecast was the low end at the end of the second quarter.

On a GAAP basis, the voluntary employee buyout program is expected to cost the company as much as $1.09 in EPS in the fourth quarter and as much as $5.31 for the full year. The quarterly cost is actually lower than the company forecast at the end of last quarter. FedEx also lowered its capital spending forecast from $3.9 billion to $3.6 billion

FedEx said that third-quarter international revenues were about $100 million below previous guidance because customers chose lower-yielding international services with lower rates per pound and lower weight per shipment. The CFO said, “We expect these trends to continue.”

Shares are down more than 3% in premarket trading this morning, at $103.00 in a 52-week range of $83.80 to $109.66. Thomson Reuters had a consensus analyst price target of around $112.80 before today’s results were announced.

Filed under: 24/7 Wall St. Wire, Earnings, Services Tagged: FDX

24/7 Wall St. Closing Bell — March 19, 2013: Market Closes Mixed Without Solution in Cyprus (JNPR, RIO, CHK, EBAY, EA, FF, SBLK, FDS, WAG, ADBE, CTAS, FTEK, WSM, FDX, GIS, LEN, AFFY, S, HAL, SLB)

Paul Ausick — Tue, 19 Mar 2013 20:05:06 +0000

U.S. equity markets opened higher this morning but worries about a resolution to the banking crisis in Cyprus soon took over and pushed shares down. In other parts of Europe, Spain’s bad loan ratio rose to 10.78% in January and eurozone economic sentiment came in far below expectations. German 10-year bond yields fell on a rising dollar. In Asia, China’s central bank will drain 39 billion yuan in liquidity with a short-term repurchase agreement after foreign direct investment fell less than expected in the month. In the U.S., the report on housing starts was somewhat better than last month, with an annualized 917,000 new homes being built (more coverage here). The Cypriot parliament rejected a revised tax proposal on bank deposits (more coverage here), so it’s anyone’s guess what tomorrow may bring.

The U.S. dollar index rose 0.35% today, now at 82.983. The GSCI commodity index is down 0.3% at 650.30, with commodities prices mixed today. WTI crude oil closed down 1.7% today, at $92.16 a barrel. Brent crude trades down 1.8% at $107.50 a barrel. Natural gas is up 2.1% today at about $3.96 per million BTUs. Gold settled up 0.4% today at $1,611.30 an ounce.

The unofficial closing bells put the DJIA up about 4 points to 14,455.90 (0.03%), the NASDAQ fell more than 8 points (-0.26%) to 3,229.10, and the S&P 500 fell -0.24% or nearly 4 points to 1,548.35.

There were a several analyst upgrades and downgrades today, including Juniper Networks Inc. (NYSE: JNPR) cut to ‘sell’ at Goldman Sachs; Rio Tinto plc (NYSE: RIO) cut to ‘sell’ at Goldman Sachs; Chesapeake Energy Corp. (NYSE: CHK) cut to ‘underperform’ at Sterne Agee (more coverage here); eBay Inc. (NASDAQ: EBAY) raised to ‘buy’ with a price target of $56 at Cantor Fitzgerald; and Electronic Arts Inc. (NASDAQ: EA) cut to ‘hold’ at Needham.

Earnings reports since markets closed last night resulted in several price moves today, including these: FutureFuel Corp. (NYSE: FF) is down 9.2% at $12.40; Star Bulk Carriers Corp. (NASDAQ: SBLK) is up 5.7% at $6.50; FactSet Research Systems Inc. (NYSE: FDS) is down 5.6% at $92.52; and Walgreen Co. (NYSE: WAG) is up 5.2% at $44.65 (more coverage here).

Before markets open tomorrow morning we are scheduled to hear from Adobe Systems Inc. (NASDAQ: ADBE), Cintas Corp. (NASDAQ: CTAS), Fuel Tech Inc. (NASDAQ: FTEK), Williams-Sonoma Inc. (NYSE: WSM), FedEx Corp. (NYSE: FDX), General Mills Inc. (NYSE: GIS), and Lennar Corp. (NYSE: LEN).

Some standouts among heavily traded stocks today include:

Affymax Inc. (NASDAQ: AFFY) is down 62.6% at $1.09 after posting a new 52-week low of $1.02 earlier today. The drugmaker fired 75% of its workforce today and will begin exploring “strategic alternatives” including bankruptcy. More coverage here.

Sprint Nextel Corp. (NYSE: S) is up 2.9% at $6.05 after posting a new 52-week high of $6.09 earlier today. The telecom company had no big news today, but led a sector that was up on a down day.

Halliburton Co. (NYSE: HAL) is down 3.4% at $39.36. The oil field services company fell on comments from competitor Schlumberger Ltd. (NYSE: SLB) that North American drilling activity was weaker in the first calendar quarter of the year. Halliburton depends far more heavily on North American drilling than does Schlumberger, hence the downturn.

Stay tuned for Wednesday. The Federal Open Market Committee (FOMC) concludes its two-day meeting this afternoon. We have also noted the following events on the schedule (all times Eastern):

7:30 a.m. – Mortgage Bankers Association purchase applications
10:30 a.m. – EIA weekly petroleum status report
2:00 p.m. – FOMC meeting announcement and forecast
2:30 p.m. – Ben Bernanke press conference

Filed under: 24/7 Wall St. Wire, HI/LOW, Market Close Tagged: ADBE, AFFY, CHK, CTAS, EA, EBAY, FDS, FDX, FF, FTEK, GIS, HAL, JNPR, LEN, RIO, S, SBLK, SLB, WAG, WSM