U.S. Stocks Up; 3M to Buy Arizant

Arthi Gupta
10 Sep, 2010
New York City

U.S. stocks advance after concerns eased on global economic recovery. IEA cautioned slowdown in oil demand. 3M agreed to acquire Arizant for $810 million. National Semiconductor profit tripled in the first quarter. Texas Instruments Inc lifted annual revenues and earnings outlook.

[R]9:35 AM New York – U.S. stocks advance after concerns eased on global economic recovery. IEA cautioned slowdown in oil demand. 3M agreed to acquire Arizant for $810 million. National Semiconductor profit tripled in the first quarter. Texas Instruments Inc lifted annual revenues and earnings outlook.[/R]

U.S. and Asian markets rose and European markets fell.

China’s trade surplus narrowed in August as import growth picked up at a faster pace and export growth slowed although not drastically, according to official data released today. As per the report, China''s trade surplus dropped to $20 billion in August from an 18-month high of $28.7 billion in July. However, the surplus increased 20% from a year ago of $15.7 billion.

In Japan, the Cabinet Office reported that the country''s gross domestic product for the second quarter was revised higher to 0.4%. The report noted that, on an annualized basis, GDP expanded 1.5%, as against the preliminary reading that showed 0.4% gain.

International Energy Agency today cautioned that world oil demand faces significant downside risk from fears that the economic recovery underway slows. In its latest monthly oil market report, the agency maintained its global oil demand forecast for 2010 and 2011 almost unchanged.

The IEA projects global oil demand of 86.6 million barrels per day for 2010, up 1.9 million barrels per day from the previous year. For 2011, demand is estimated at 87.9 million barrels per day, up 1.3 million barrels per day.

IEA is slightly more optimistic about supplies from non-OPEC nations in 2010 and 2011, even while remaining cautious of supplies from the Gulf of Mexico region being disrupted by Atlantic storms.

3M, the diversified technology company entered into an agreement to acquire Arizant Inc. for a purchase price of $810 million in cash to expand its infection prevention product portfolio.

3M said it expects the deal, on a GAAP reported basis, to be $0.03 dilutive to earnings per share in the first 12 months following completion of the transaction. Excluding purchase accounting adjustments and anticipated integration expenses, 3M estimates the acquisition to be neutral to earnings over the same period.

Arizant is a leading manufacturer of patient warming solutions designed to prevent hypothermia in surgical settings.

Nokia Corp. today appointed Stephen Elop as President and Chief Executive Officer of the company, effective September 21. Elop replaces Olli-Pekka Kallasvuo, who will leave his position as President and CEO of Nokia on September 20 and his position on the Nokia board as well.

eBay Inc. said on Thursday that the Delaware Court of Chancery ruled in its favor in a shareholder suit filed against Craigslist, and its majority shareholders Jim Buckmaster and Craig Newmark.

eBay said the ruling overturns a series of unlawful transactions undertaken by Craigslist''s majority shareholders to dilute eBay''s minority share in the company. The ruling rescinded a poison pill and right of first refusal adopted by the controlling shareholders in January 2008 and restored eBay''s 28.4% share in Craigslist.

Earnings Review

Diodes Incorporated ((DIOD)), the manufacturer of high-quality application specific standard products raised its third quarter revenue guidance between $161 million and $166 million from its prior guidance of between $158 million and $164 million.

John Wiley & Sons, Inc. ((JW.A)), the book publisher reported first quarter revenues grew 5% to $407.94 million from $388.38 million in the prior-year quarter. Net income in the quarter increased 64% to $44.05 million or 72 cents per diluted share, compared with net income of $26.88 million or 45 cents per share in the same quarter last year.

Korn/Ferry International ((KFY)), the talent management solutions provider reported first quarter revenue surged 48.6% to $183.16 million from $123.28 million for the year-ago period. Net income in the quarter was $10.90 million or 24 cents per diluted share, compared to a net loss of $14.27 million or 33 cents per share for the previous year.

National Beverage Corp. ((FIZZ)), the beverage maker reported first quarter net sales rose 1.4% to $165.03 million from $162.83 million in the year-ago quarter. Net income in the quarter climbed 23% to $12.05 million or 26 cents per diluted share, compared to net income of $9.79 million or 21 cents per share in the prior-year quarter.

National Semiconductor Corporation ((NSM)), the semiconductor company said first quarter net sales rose 31% to $412.0 million from $314.4 million in the same quarter last year. Net income in the quarter tripled 198% to $88.8 million or 36 cents per diluted share, compared to net income of $29.8 million or 13 cents per share for the year-ago quarter.

Texas Instruments Inc. ((TXN)), the chipmaker narrowed its earnings and revenue outlook for the third quarter. The company estimates earnings of $0.66 to $0.72 per share, compared to its prior estimate of $0.64 to $0.74 per share. Revenue is expected in the range of $3.62 billion to $3.78 billion, compared to the previous target of $3.55 billion to $3.85 billion.