U.S. Home Sales Rise 2.1%, Cisco to Buy Meraki for $1.2 B

Arthi Gupta
19 Nov, 2012
New York City

U.S. indexes advanced as lawmakers show willingness to avert so called fiscal cliff and existing home sales increased for the seventh month in a row. Cisco agreed to acquire Meraki for $1.2 billion and Electronics for Imaging agreed to buy Technique.

[R]11:00 AM New York – U.S. indexes advanced as lawmakers show willingness to avert so called fiscal cliff and existing home sales increased for the seventh month in a row. Cisco agreed to acquire Meraki for $1.2 billion and Electronics for Imaging agreed to buy Technique.[/R]

U.S. and European market indexes gained more than 1.4% after lawmakers of both parties showed willingness to be flexible.

The market sentiment further improved after existing home sales in October increased 2.1% to a seasonally adjusted 4.79 million homes.

National Association of Realtors said in a statement released today that median price of existing home surged 11.1% to $178,600 from a year ago and inventory of unsold homes declined 1.4% to 2.14 million units in the month.

Distress home for sales percentage of total sales declined to 24% from 28% in the year ago month.

Separately, National Association of Home Builders said its index of home builder sentiment rose to 46 in November, from 41 in October.

The sentiment index increased for the seventh month in a row and reached to a 7-year high. However, the index remained below 50 indicating more builders consider market conditions as weak than favorable.

Cisco to Acquire Meraki

Cisco Systems Inc. agreed to acquire privately-held Meraki Inc., a cloud networking provider to offer more software-centric solutions to simplify network management.

Under the terms of the agreement, Cisco will pay approximately $1.2 billion in cash and retention-based incentives to acquire the entire business and operations of Meraki.

The acquisition is expected to close in the second quarter of Cisco’s fiscal year 2013.

EFI Acquires Technique

Electronics for Imaging, Inc. agreed to acquire Technique Inc., a developer of supply chain and production system software.

Technique products will become part of EFI''s Productivity Software portfolio on completion of the transaction. Financial terms of the acquisition were not disclosed.

Liberty Media Lifts Sirius Stake

Liberty Media Corp. raised its stake slightly in Sirius XM Radio Inc. to 49.8%. In a Securities and Exchange Commission filing, the company said it has increased its stake in Sirius by 30.96 million shares, at an average price of $2.66 per share.

Earnings Review

Laclede Group Inc. ((LG)), the natural gas service provider reported fourth quarter operating revenues dropped to $169.5 million from $271 million last year. Net loss for the quarter narrowed to $0.7 million or 3 cents per diluted share from $2.9 million or 13 cents per share in the same period last year.

Lowe''s Companies, Inc. ((LOW)), the home improvement retailer reported third quarter sales increased 1.9% to $12.1 billion on comparable store sales rise of 1.8. Net earnings in the quarter surged to $396 million or 35 cents per diluted share from $225 million or 18 cents per share in the year-ago quarter.

Tyson Foods, Inc. ((TSN)), the chicken, beef and pork processors and marketers reported fourth quarter sales fell to $8.37 billion compared with $8.40 billion in the prior-year quarter. Net income in the quarter rose to $185 million or 51 cents per diluted share from $97 million or 26 cents per share last year.