Barnes & Noble, Freddie Mac Surge

Mayank Mehta
10 Aug, 2009
New York City

Freddie Mac surges after it reported its first profit in two years. The mortgage lender also paid $1.1 billion in dividends to U.S. Treasury. Dish Network surged 10% on better than expected earnings. Best Buy declined on rating downgrade. Barnes & Noble surges 10% on a related party acquisition.

[R]12:30 PM New York – Freddie Mac surges after it reported its first profit in two years. The mortgage lender also paid $1.1 billion in dividends to U.S. Treasury. Dish Network surged 10% on better than expected earnings. Best Buy declined on rating downgrade. Barnes & Noble surges 10% on acquisition of college bookseller from its founder.[/R]

Of the stocks in S&P 500 index, 136 increased, 356 declined and 8 were unchanged.

Eastman Kodak Company led the decliners in the S&P 500 index with a loss of 5.1% followed by losses in Best Buy Co., Inc of 5.1%, in Plum Creek Timber Company, Inc of 3.7%, in International Paper Company of 3.5% and in Macy''s, Inc of 3.3%.

American International Group, Inc led gainers in the S&P 500 index with a rise of 9.3% followed by gains in Citigroup Inc 6.4%, in Hormel Foods Corporation of 5.3% and Zions Bancorporation of 4.9%.

Other Movers

AAON, Inc ((AAON)) added 3.0% or 61 cents to $20.80 after the manufacturer of air-conditioning and heating equipment reported second quarter sales fell 8% to $68.6 million from $74.8 million a year ago. Net profit in the quarter fell 9% to $7.1 million or 41 cents per diluted share compared to net income of $7.8 million or 43 cents per share a year ago.

Allegiant Travel Company ((ALGT)) declined 3.2% or $1.37 to $40.92.

Allied Capital Corporation ((ALD)) dropped 8.0% or 31 cents to $3.55 after the lending firm posted its sixth quarterly loss in a row and said it remained in default on its credit facilities. The lender also reported second quarter loss of 16 cents a share or $29 million compared to 59 cents a share or $102 million.

Bank of America Corporation ((BAC)) rose 1.6% or 27 cents to $16.69.

Barnes & Noble ((BKS)) surged 7% to $25.72 after it agreed to acquire from its chairman Leonard Riggio Barnes & Noble College Booksellers, Inc for $460 million net of cash. The company expects the transaction to be accretive and add $115 million in earnings in the current fiscal year and increase earnings per share by 30% to 35% on the estimated earnings per share between $1.10 and $1.40 a share.

Best Buy Co., Inc ((BBY)) the world’s electronics retailer dropped 4.4% or $1.77 to $37.98 after Goldman Sachs lowered its rating on the company.

Chindex International, Inc ((CHDX)) advanced 14.0% or $1.85 to $15.00 after the provider of western healthcare products and services reported first quarter revenues rose 41% to $45.3 million from $32.1 million a year ago. Net profit in the quarter was $3.3 million or 20 cents per diluted share compared to net loss e of $161,000 or 1 cent per share a year ago.

Dish Network Corporation ((DISH)) rose 10.0% or $1.78 to $20.20 after the satellite TV provider reported second quarter sales fell 0.3% to $2.90 billion from $2.91 billion a year ago. Net profit in the quarter fell 81% to $63.4 million or 14 per diluted share compared to net income of $335.9 million or 73 cents per share a year ago.

Dynegy Inc ((DYN)) fell 2 cents to $1.93 after the power provider reported second quarter sales rose 53% to $493 million from $322 million a year ago. Net loss in the quarter was $345 million or 41 per diluted share compared to net loss of $272 million or 32 cents per share a year ago.

Eli Lilly and Company ((LLY)) dropped $1.10 to $33.79 after the drug maker was downgraded by Goldman Sachs.

Freddie Mac ((FRE)) surged 71.6% or 53 cents to $1.27 after it reported quarterly profit for the first time in two years. The mortgage lender net in the second quarter was $768 million compared to loss of $9.9 billion. The lender also did not request additional funding from the government after it had a positive net worth of $8.2 billion at the end of the quarter.

Houston Wire & Cable Company ((HWCC)) plunged 6.7% or 71 cents to $9.85 after the distributor of specialty wire and cable, and related services reported second quarter sales fell 36.4% to $61.9 million from $97.4 million a year ago. Net income in the quarter fell 76.6% to $1.8 million or 10 cents per diluted share compared to net income of $7.7 million or 44 cents per share a year ago.

Research In Motion Limited ((RIMM)) slumped 3.6% or $2.77 to $74.35 after the BlackBerry maker was downgraded from “buy” to “neutral” at UBS.

Sysco Corporation ((SYY)) lost 1.5% or 38 cents to $24.47 after the distributor of food and related products reported fourth quarter sales fell 6.2% to $9.1 billion from $9.7 billion a year ago. Net income in the quarter fell 5.6% to $315.3 million or 53 cents per diluted share compared to net income of $334.1 million or 55 cents per share a year ago.

Virgin Mobile USA, Inc ((VM)) slipped 1.8% or 9 cents to $4.77 after the wireless services provider reported second quarter sales fell 3.8% to $307.6 million from $319.9 million a year ago. Net income in the quarter rose 380% to $16.8 million or 23 cents per diluted share compared to net income of $3.5 million or 7 cents per share a year ago.

YRC Worldwide Inc ((YRCW)) the trucking services provider jumped 20.7% or 47 cents to $2.73.