14 Min Read
(For more market insights, including options activity, click on ; for the Day Ahead newsletter link.reuters.com/mex49s; for the Morning News Call newsletter, link.reuters.com/nex49s) U.S. stocks fell on Thursday, with the S&P 500 pulling back from record levels following a round of disappointing earnings as financial stocks led the way lower. The Dow Jones industrial average was down 0.41 percent at 16,414.67, the S&P 500 was down 0.17 percent at 1,845.15 and the Nasdaq Composite was up 0.05 percent at 4,216.831.
** BEST BUY CO INC, $27.04, -28.03 pct
The world's largest consumer electronics chain reported a drop in holiday sales and forecast a bigger-than-expected decline in quarterly operating margins.
** CITIGROUP INC, $52.81, -3.96 pct
The third-largest U.S. bank posted a lower-than-expected quarterly profit as the bank's fixed-income revenue declined in a "challenging trading environment."
For a graphic on earnings, (link.reuters.com/cuz95v)
** GOLDMAN SACHS GROUP, $175.08, -2.05 pct
Goldman Sachs Group reported a 21 percent drop in quarterly profit on Thursday as revenue from fixed-income trading fell in what Chief Executive Lloyd C. Blankfein described as "a somewhat challenging environment."
For a Breakingviews column, click
For a graphic on earnings, (link.reuters.com/guz95v)
** BLACKROCK INC, $318.9, +1.97 pct
The world's largest money manager reported a higher-than-expected quarterly profit, benefiting from strong markets and a flow of new money into its exchange-traded funds.
** SAREPTA THERAPEUTICS INC, $27.93, +39.79 pct
The company said data from an extended study of its drug to treat a rare muscular disorder in young boys showed continued stabilization of walking ability in patients.
The drug, eteplirsen, was well tolerated and there were no adverse treatment-related events or discontinuations at 120 weeks of treatment, the company said.
In October 2012, Sarepta said the trial met its main goal of increasing the level of a key protein after 48 weeks of treatment. The study was extended to monitor the drug's safety and efficacy.
Janney Capital Markets analyst Kimberly Lee said the stock movement was unwarranted as the data was collected from only six patients.
"The company will need to test the drug in more patients," she wrote in an email to Reuters.
** ** THOMPSON CREEK METALS CO INC, $3.01, +4.15 pct
BofA Merrill Lynch upgraded the mining company's stock to "buy" from "underperform" on Tuesday, pulling it up by close to 20 percent. The company said in December it was planning to diversify away from molybdenum, the steelmaking material whose prices fell in the third quarter.
** TURQUOISE HILL RESOURCES LTD, $3.88, +9.60 pct
Canadian coal producer SouthGobi Resources Ltd that owns and operates projects in Mongolia and is majorly owned by Canadian miner Turquoise Hill said coal sales in the three months ended Dec. 31 jumped to 1.72 million tonnes from 0.3 million tonnes, a year earlier.
** ZYNGA INC, $3.6, -10.67 pct
Brokerage Sterne Agee & Leach Inc said it believes the social gaming company's first-quarter "guidance is likely to disappoint," as it sees no reversal to declining traffic and bookings that have fallen throughout last year. The brokerage added that it expects the Street's estimates will see significant downward revisions post the fourth-quarter results, due February.
** MRC GLOBAL INC, $31.03, -1.49 pct
Bank of America Merrill Lynch cut its rating on the stock of the supplier of pipes, valves and fittings to "underperform" from "buy" and the target price to $30 from $33.
The IT outsourcing company, which reported fourth-quarter results, said in a conference call that it expects a rise in expenses in the current quarter as it continues to hire more people.
** YRC WORLDWIDE INC, $15.1977, +18.92 pct
The struggling trucker said it was in talks to revise a labor contract after an earlier proposal was rejected by Teamsters union workers.
** PROSENSA HOLDING NV $6.8405, +23.47 pct
The company said additional data from a study of its drug to treat a rare muscular disorder suggest that treating patients earlier and longer showed a delay in the progression of the disease.
Prosensa said the data suggests that there was a regulatory path forward for the drug, which failed a late-stage study last September, prompting its partner GlaxoSmithKline Plc to return its rights.
** NU SKIN ENTERPRISES INC, $82.41, -28.48 pct
** HERBALIFE LTD, $70.61, -11.05 pct
China's State Administration for Industry and Commerce (SAIC) on Thursday ordered local authorities to investigate media reports that allege that the skincare products company distributes false information and conducts illegal business in China, state news agency Xinhua said.
Shares of nutritional supplements maker Herbalife, which gets about 8 percent of its revenue from China, also fell on the same news.
** ZOOM TECHNOLOGIES INC, $5.2015, +20.97 pct
The China-based maker of modems and Bluetooth wireless equipment said it will acquire Tinho Union Holding Group in an-all stock deal worth about $81 million. Zoom would issue about 9.4 million shares of its common stock and Tinho shareholders would own about 75 percent of Zoom after the transaction closes. Tinho Union offers online ticket booking and related services for business travel.
** RENTRAK CORP, $47.69, +25.57 pct
The content provider said CBS Corp would use its TV Essentials TV ratings product.
"This represents a major advancement for Rentrak in its path to gaining industry acceptance for its census-based approach to TV measurement," Brean Capital analyst Todd Mitchell said in a note and raised his price target on the stock to $58 from $50.
** ALAMOS GOLD INC, $10.69, -14.41 pct
The miner forecast lower full-year production and higher cash costs as output from its high-grade Escondida deposit in Mexico winds down. Alamos forecast 2014 production to fall to 150,000-170,000 ounces of gold from 190,000 ounces in 2013.
** J.C. PENNEY CO INC, $6.869, -2.01 pct
The U.S. retailer said on Wednesday it would close 33 stores and cut 2,000 jobs as part of its efforts to return to profitability. Chief Executive Myron Ullman said in a statement the action "addresses a strategic priority to improve the profitability of our stores."
** CONCORD MEDICAL SERVICES HOLDINGS LTD, $5.72, +10.00 pct
The company, which operates radiotherapy and diagnostic imaging centers in China, is set to benefit from the growing prevalence of cancer in that country and wider coverage of government sponsored health insurance, a report on investment website SeekingAlpha said.
The report said the company's stock is significantly undervalued and has the potential to grow 30 percent in 2014 as its earnings rise. (link.reuters.com/cub26v)
** NORDIC AMERICAN TANKER LTD, $11.04, +10.07 pct
** FRONTLINE LTD, $4.9, +2.73 pct
Rates of very large crude carriers (VLCCs) in the Middle East and Gulf region rebounded, while in the west VLCC activity has risen, Morgan Stanley analyst Fotis Giannakoulis said in his daily note to clients.
JPMorgan Asset Management Holdings Inc increased its stake in tanker operator Frontline earlier this week, according to a release on the Oslo Stock Exchange. (r.reuters.com/reb26v)
** APOLLO GLOBAL MANAGEMENT LLC, $35.74, -0.03 pct
** CEC ENTERTAINMENT INC, $54.54, +12.62 pct
Apollo Global will buy CEC Entertainment, the parent of Chuck E Cheese's restaurant chain, for about $948 million, adding to a portfolio that includes companies ranging from cruise ship operators to casinos.
** RICEBRAN TECHNOLOGIES, $6.221, +1.15 pct
The food ingredients company said it reached a multi-year supply agreement with Hela Spice Canada Inc to distribute Ricebran brands throughout Canada.
** LOGITECH INTERNATIONAL, $13.75, -6.97 pct
Vontobel raised its target price on the computer accessories maker's stock to 14 Swiss Francs from 9.7 Swiss Francs citing higher sales of the company's UE Boom speaker, iPad keyboards, iPhone and Android accessories and higher mid-term operating margins. The brokerage has a "hold" rating on the stock.
** AOL INC, $52.59, +11.30 pct
AOL is handing majority ownership of Patch, a money-losing network of local news websites, to New York investment firm and turnaround specialist Hale Global in a joint venture announced by the companies on Wednesday.
** CSX CORP, $27.19, -6.98 pct
CSX on Wednesday posted a fourth-quarter profit that fell short of Wall Street's estimates as rising shipments of chemicals, autos and agricultural products failed to make up for weak coal volumes.
Brokerage Stifel downgraded the stock to "hold" from "buy".
** TESSERA TECHNOLOGIES, $19.56, -8.49 pct
The technology patent company said it expected to recognize a charge of $50 million to $55 million related to restructuring of its DigitalOptics unit. The company said it would record 75 percent of the charge in the fourth quarter, and the rest in the first half of 2014. Tessera said it would stop all DigitalOptics' manufacturing operations, except image enhancement, reduce its workforce by about 300 employees and close its facilities in California, New York, Taiwan and Japan.
** HELEN OF TROY LTD, $57.02, +8.80 pct
The consumer products company said it appointed Julien Mininberg as its new chief executive effective March 1. Mininberg, who headed the company's healthcare and home environment business, replaces Gerald Rubin, who has served as the CEO for the last 14 years.
** EMULEX CORP, $7.51, +3.44 pct
BofA Merrill upgraded the chipmaker's stock to "buy" from "underperform", saying investors are not giving due credit to the company's November announcement of a $200 million share repurchase program and expansion of its restructuring plan to save $30 million in costs.
** SOLARCITY INC, $76.3299, +11.43 pct
Analysts at Deutsche Bank began coverage of the U.S. solar panel installer with a "buy" rating and a price target of $90, saying SolarCity's customer base could double by the end of the year due to a growth in the residential solar market. The price target is 31 percent higher than the stock's Wednesday close.
** HUNTINGTON BANCSHARES INC,$9.59, -3.13 pct
The bank reported a 6 percent fall in its quarterly profit as it earned lower mortgage banking income. Noninterest income fell 17 percent to $246.6 million compared with the same quarter a year earlier, while income from mortgage banking fell about 61 percent to $24.3 million.
** HYDROGENICS CORP, $22.7, +9.56 pct
The Canadian fuel cell maker said it received a C$3.8 million ($3.47 million) contract to supply an energy storage application, which would store surplus wind energy as hydrogen. Hydrogenics expects to deliver this project in late 2014, it said early on Thursday.
** DENDREON CORP $3.18, -4.50 pct
The cancer vaccine maker continues to struggle with cost-cutting and its vaccine, Provenge, would face hurdles in the European Union due to varying reimbursement rates, Roth Capital analyst Joseph Pantginis said in a note to clients.
"A major question that remains is how the company will deal with the $600 million in convertible debt that comes due in 2 years," said Pantginis, who has a "sell" rating on the stock.
** RIO TINTO LTD, $54.89, +3.59 pct
Rio Tinto reported big increases in the production of iron ore and other minerals in 2013, betting China's massive economic growth will provide a ready market for decades to come.
** LIME ENERGY CO, $3.5496, +3.19 pct
The energy-saving devices maker's stock could rise to $8 this year, driven by a continued increase in quarterly revenue, profit, reduction of debt and share buybacks, according to a report on investment website Seeking Alpha. (link.reuters.com/vab26v)
** BOSTON PRIVATE FINANCIAL HOLDINGS INC, $13.19,+8.74 pct
The regional lender reported a higher-than-expected quarterly profit as it kept aside less money to cover bad loans.
Provision for loan losses fell 60 percent to $2 million for the fourth quarter.
** KROGER CO, $37.49, -4.51 pct
Credit Suisse downgraded its rating on the biggest U.S. supermarket operator's stock to "neutral," Theflyonthewall.com reported.
** CBL & ASSOCIATES PROPERTIES INC, $17.61, -2.22 pct
J.P. Morgan Securities downgraded the real estate investment trust's stock to "neutral" from "overweight" and cut its price target to $21 from $23 as the brokerage expects a moderate earnings growth trajectory.
** INTEL CORP, $26.57, -0.38 pct
The chipmaker reports fourth-quarter results after markets close and some analysts expect the company's revenue could slightly beat already low expectations. Intel is expected to maintain its 2014 forecast for flat sales.
** AMERICAN EXPRESS CO, $87.61, -0.73 pct
** CAPITAL ONE FINANCIAL CORP, $76.51, -0.68 pct
Higher card spending and lower default rates are expected to help American Express and Capital One Financial beat estimates when they report quarterly results after markets close, according to forecasts from StarMine's most accurate analysts. (Compiled by Varun Aggarwal in Bangalore; Editing by Sriraj Kalluvila)