Rio Tinto Pluges; Nuance, American Eagle Surges

Mayank Mehta
25 Nov, 2008
New York City

BHP Billiton rises and Rio Tinto plunges after BHP withdrew its hostile offer. Chicos, American Eagle, Talbots and Citi Trends rose after the release of earnings. China Finance rose 23% on 109% quarterly revenues gain. Genworth plunges 23%. Goldman Sachs soars 6.5%. Lennar and Horton surge.

[R]11:44PM New York – BHP Billiton rose and Rio Tinto plunged after BHP withdrew its hostile offer. Chico’s, American Eagle Outfitters, Talbots and Citi Trends rose after the release of earnings.[/R]

American Eagle Outfitters, Inc ((AEO)) surged 8.5% or 71 cents to $9.06 after the teenage apparel retailer reported third quarter sales rose 1% to $754 million from $744 million a year ago. Net income in the quarter fell 57% to $42.6 million or 21 cents per diluted share compared to net income of $99.4 million or 45 cents per share a year ago. Comparable same store sales decreased 7%. The company also declared quarterly dividend of 10 cents a share.

BHP Billiton Limited ((BHP)) rose 14.5% or $4.85 to $38.27 and rival Rio Tinto PLC ((RTP)) shares plummeted 27% after BHP withdrew its $78 billion hostile takeover offer. BHP also said it will take $450 million write off for the merger exploration offer and cited high borrowing costs that cannot be supported by the cash flow of the combined company.

Bank of Montreal ((BMO)) rose 2.2% or 61 cents to $28.16 after the Canada based bank reported fourth quarter revenues increase of 27.9% to $2.8 billion from $2.2 billion a year ago. Net income in the quarter rose 24% to $560 million or $1.08 per diluted share compared to net income of $452 million or 89 cents per share a year ago.

China Finance Online Co. Limited ((JRJC)) rose 23% or $1.17 to $6.35 after revenues rose 109% to $15.23 million from $7.30 million a year ago. Net income in the quarter rose 151% to $4.77 million or 21 cents per diluted ADS compared to net income of $1.90 million or 8 cents per ADS a year ago.

Citi Trends, Inc ((CTRN)) surged 34.3% or $2.96 to $11.59 after the clothing retailer reported better than expected quarterly results. In the latest quarter the company reported a loss of 5 cents a share lower than its estimate of loss of between 9 cents and 13 cents. The company also lowered its annual earnings outlook to between 95 cents and $1.05 compared to previous estimate of between $1.10 and $1.15 a share on same stores sales decline between 3% and 6% in the fourth fiscal quarter.

CB Richard Ellis Group, Inc ((CBG)) decreased 11.4% or 58 cents to $4.48 after the company estimated that office rents in West end in London, UK, midtown Manhattan, New York and financial district of Tokyo, Japan fell in the third quarter for the first time in almost seven years as the global financial crisis cut demand.

Chico’s FAS, Inc ((CHS)) rose 10% or 23 cents to $2.58 after it reported better than expected quarterly results. The apparel retailer reported third quarter sales fell 5.2% to $394.2 million from $415.9 million a year ago. Net income in the quarter fell 91.5% to $2.0 million or 1 cent per diluted share compared to net income of $23.6 million or 13 cents per share a year ago.

Citigroup Inc ((C)) added 2.2% or 13 cents to $6.08 a day after the Fed, U.S. Treasury and FDIC offered second rescue package that guaranteed bank loans and injected $20 billion in the company. The Fed also offered new loans of $800 billion for mortgage and asset backed securities markets.

Donaldson Company, Inc ((DCI)) rose 6.7% or $1.85 to $29.62 after the company offered flat sales guidance for the full year matching the revenues of last year of $2.2 billion. Air and liquid filtration maker said first quarter sales rose 9% to $573.3 million from $525.6 million a year ago. Net income in the quarter rose 11% to $48 million or 60 cents per diluted share compared to net income of $43.3 million or 53 cents per share a year ago.

Dollar Tree, Inc ((DLTR)) rose 9.2% or $3.50 to $41.78 after the discount retailer reported third quarter earnings per share of 47 cents, quarterly revenue of $1.11 billion and same store sales gain of 6.2%.

Genworth Financial, Inc ((GNW)) declined 23.5% or 40 cents to $1.30 on the worries that recent ratings downgrade may raise the cost of borrowing and the company may be forced to to raise capital in the near future and dilute current shareholders. The company stock has fallen 95% in the last one year of trading.

The Goldman Sachs Group, Inc ((GS)) rose 6.5% or $4.36 to $71.78 after it reported planning to sell $2 billion in new senior unsecured debt guaranteed by the Federal Deposit Insurance Corp under its recently approved temporary liquidity guarantee program. The company also plans to cut staff in its Tokyo office.

Hewlett-Packard Company ((HPQ)) lost 5.9% or $2.10 to $33.60 after it reported fourth quarter revenues rose 19% to $33.6 billion from $28.3 billion a year ago. Net income in the quarter fell 2% to $2.11 billion or 84 cents per diluted share compared to net income of $2.16 billion or 81 cents per share a year ago.

Net revenue for the full fiscal year was $118.4 billion, growth of 13% or 8% when adjusted for currency. Diluted earnings per share were $3.25 up from $2.68 in the prior year. For the first quarter 2009 HP expects revenues between $32.0 billion and $32.5 billion and diluted earnings per share in the range of $0.80 to $0.82.

JPMorgan Chase & Co ((JPM)) climbed 8% or $2.19 to $29.77 along with other stocks in the financial sector. The Fed in its latest action offered up to $800 billion in loans for the purchase of mortgage and asset backed securities.

Legg Mason, Inc ((LM)) slid 2.6% or 41 cents to $16.13 after Friedman Billings Ramsey analyst cut its price target to $11 from $18 and lowered earnings estimate for 2009 to 4 cents a share and 2010 earnings to $2.46 a share from $2.65 a share. The asset manager may also have to support a failing structured investment vehicle that can deplete cash from its balance sheet and create a scenario for a tight liquidity situation for the company.

Lennar Corporation ((LEN)) surged 31.7% or $1.45 to $6.03 after the Fed offered up to $600 billion in loan facility to purchase mortgage backed securities. The latest Fed action was announced this morning that lifted stocks of other home builders.

Nuance Communications, Inc ((NUAN)) soared 17% or $1.28 to $8.78 after the provider of speech-based solutions for businesses and consumers worldwide said fourth quarter revenues increased 41% to $253.4 million from $179.9 million a year earlier. Net income in the quarter was $22.0 million or 9 cents per diluted share compared to net loss of $3.4 million or 2 cents per share a year ago.

Star Bulk Carriers Corp ((SBLK)) dropped 4.7% or 10 cents to $2.04 after the dry bulk cargo ocean carrier said third quarter revenues of $65.18 million and net income of $35.24 million or 62 cents per diluted share compared to net income of $0.94 million or 3 cents per share a year ago.

The Talbots, Inc ((TLB)) surged 26% or 54 cents to $2.66 after the specialty apparel retailer reported third quarter sales fell 14% to $357 million from $414 million a year ago. Net loss in the quarter was $167.2 million or $3.13 per diluted share compared to net loss of $9.4 million or 18 cents per share a year ago.