15 Min Read
(For faster updates on individual market-movers, Eikon users please use search string "STXBZ US"; for the Day Ahead newsletter, link.reuters.com/mex49s; for the Morning News Call newsletter, link.reuters.com/nex49s)
U.S. stocks turned lower in afternoon trading on Wednesday, with major indexes erasing earlier gains as both Boeing and Biogen sold off following their results. The Dow Jones industrial average was down 0.66 percent at 16,505.38, the S&P 500 was down 0.41 percent at 1,933.32 and the Nasdaq Composite was down 0.44 percent at 4,399.87.
** BOEING CO, $121.77, -4.21 pct
The aircraft maker's third-quarter operating margin in its commercial aircraft unit fell to 11.2 percent from 11.6 percent, reflecting the effect of deliveries of lower-margin 787 and 747 aircraft
Analysts expressed concerns over signs of a rise in costs for the company's 787 Dreamliner. A relatively small increase in Boeing's full-year cash flow outlook and higher deferred production costs for the 787 "will increase the bear calls," Sterne Agee analyst Peter Arment said.
Graphic on Boeing's earnings (link.reuters.com/xud33w)
** BIOGEN IDEC, $309.15, -5.39 pct
The biotechnology company's third quarter sales of its big-selling new oral multiple sclerosis drug Tecfidera fell short of lofty Wall Street estimates for the first time.
"Generally a solid quarter, though a slight Tecfidera miss and lack of revenue guidance raise might disappoint some," Wells Fargo analyst Brian Abrahams wrote in a note.
** YAHOO INC, $42.127, +4.85 pct
At least nine brokerages raised their price targets on the online search and advertising company's stock by as much as $10 to a high of $53.
The company's third-quarter revenue beat Wall Street's target as revenue from Yahoo's search business rose 4 percent.
Chief Executive Marissa Mayer spent much of Tuesday's earnings call highlighting improvements in Yahoo's mobile business, the benefits from acquisitions and billions of dollars in buybacks.
** BROADCOM CORP, $39.54, +5.92 pct
Four brokerages raised their price targets on the chipmaker's stock after third-quarter results of the company, whose WiFi connectivity chips are used in Apple's iPhones, exceeded Wall Street's estimates on Tuesday.
"We like Broadcom stock, which we think should continue to rerate higher from its current low valuation as the focus shifts towards the company's strengths in networking, infrastructure, and broadband," Morgan Stanley said in a note to clients.
Morgan Stanley raised its price target on the stock to $47 from $44, above the median price target of $45.
** 3D SYSTEMS CORP, $36.84, -15.08 pct
The three-dimensional printer maker slashed its full-year revenue forecast, falling short of analysts' expectations as it struggles to capitalize on demand for 3D metal printers due to manufacturing constraints.
** ZIX CORP, $3.17, -13.86 pct
Imperial Capital cut its price target on the email encryption services provider's stock to $5 from $6 on a "recent multiple contraction in the sector". The stock has a median price target of $5.
The company's third-quarter revenue marginally missed the average analyst estimate.
New first year orders of $1.6 million are the lowest in over two years, Imperial Capital analyst Michael Kim said.
** DEAN FOODS CO, $14.62, +4.95 pct
Morgan Stanley analysts upgraded the milk processor's stock to "overweight", and raised their price target to $17 from $15. The stock has a median price target of $16.50.
Declining milk prices, stabilizing volumes and improving operating leverage should drive a meaningful recovery in 2015 results, the analysts wrote in a note.
** WILLBROS GROUP INC, $4.93, -35.56 pct
The specialty energy infrastructure contractor's stock touched a 22-month low and was the top percentage loser on the New York Stock Exchange.
The company will restate results for the second-quarter ended June 30 after it identified an error in the estimation process of a "significant" pipeline construction project.
The company said correction of the error would result in the reversal of about $8 million in pre-tax income recognized in the quarter and that it would record $14-$16 million in estimated pretax losses at completion of the project.
Brokerage Johnson Rice & Co cut its rating on the stock to "equal weight" from "overweight".
Chief Executive Robert Harl gave up his position ahead of his planned retirement on Jan. 2. Willbros did not disclose the reason for Harl's early departure and named Executive Chairman John McNabb CEO on Tuesday.
** REPROS THERAPEUTICS INC, $6.215, +3.24 pct
The drug developer said a long-term safety study showed its experimental testosterone replacement drug Androxal showed no negative effects on bone mineral density compared with a placebo. The company is scheduled to meet the FDA in the first half of November to discuss the drug.
** PROTEON THERAPEUTICS INC, $10.05, +0.50 pct
The biopharmaceutical company's shares opened at $11.30 in its market debut and rose as much as 20 percent, valuing the company at $168.5 million.
The offering was priced at $10 per share, below the expected range of $12-$14 of 6.1 million shares and raised about $61 million.
** HIMAX TECHNOLOGIES INC, $7.5601, -5.73 pct
The Taiwanese chipmaker's stock continued to lose ground after falling 14 percent in extended trading on Tuesday, after the company said Google Inc would not make an additional investment in its display unit.
** ENDEAVOUR SILVER CORP, $3.86, -6.99 pct
** SILVER STANDARD RESOURCES INC, $5.46, -4.88 pct
** HECLA MINING CO, $2.36, -5.22 pct
** AGNICO EAGLE MINES LTD, $28.95, -4.49 pct
** IAMGOLD Corp, $2.315, -4.73 pct
Shares of gold and silver miners fell between 2.2-3.9 percent.
Gold slipped as the dollar rose to a one-week high against the euro on signs of softening physical demand.
Spot gold was down 0.3 percent at $1,244.85 an ounce at 1340 GMT. Silver was down 1.5 percent at $17.25 an ounce.
** ANGIE'S LIST INC, $6.8, -17.87 pct
The operator of a website that allows users to review local businesses reported a bigger-than-expected quarterly loss as it added fewer paid members. The company's shares fell as much as 20 percent, adding to their steady decline through the year. Angie's also forecast current-quarter revenue below Wall Street estimates.
** ANCHOR BANCORP WISCONSIN INC, $30, +15.38 pct
The bank's stock opened at $28.66 in its market debut and rose as much as 18 percent, valuing the company at $285.5 million. The offering of 371,959 shares was priced at $26 per share and raised about $9.7 million.
** DISCOVER FINANCIAL SERVICES, $61.26, -4.85 pct
The payment services provider said it expected its fourth-quarter net interest margin to be fall slightly and posted a 6 percent rise in third-quarter expenses. Four brokerages lowered their price targets on the company's stock.
"We are reducing our estimate due to higher non-interest expense, reflecting the need to bolster infrastructure in the current regulatory environment, and slightly lower NIM due to higher funding costs...," said brokerage FBR, which cut its price target to $70 from $72.
** TUPPERWARE BRANDS CORP, $64.22, -10.07 pct
The food container maker's stock fell to its lowest in 20 months as the company cut its full-year earnings forecast to $5.21-$5.26 per share from $5.40-$5.50.
Tupperware's third-quarter profit and sales missed the average analyst estimate as demand in emerging markets, which accounts for 70 percent of sales, fell.
** BLUE EARTH INC, $1.373, +6.43 pct
The alternative energy services provider's stock lost half its value in record volumes on Tuesday, its largest fall in four years, with 6.7 million shares changing hands.
The company responded late on Tuesday to a short-seller's article on Seeking Alpha which alleged that the company was a "questionable" reverse merger led by Chief Executive Jenny Thomas and Vice President John Francis. (bit.ly/1otw5Qg)
The report "compiles selective information in a false and misleading manner to maliciously advance, we believe, a short agenda for personal gain," Blue Earth said.
** REGULUS THERAPEUTICS INC, $13.6135, +101.09 pct
The drug developer's interim results of a study testing its hepatitis C drug (HCV) as a monotherapy showed significant improvement in patients, including in difficult-to-treat genotypes.
Drug, RG-101, was safe and well-tolerated and its profile could allow for combination with other agents to treat HCV, Regulus said.
** JOHNSON & JOHNSON, $101.36, +1.00 pct
** GLAXOSMITHKLINE PLC, $44.58, +2.18 pct
** NEWLINK GENETICS, $39.4594, +14.38 pct
** TEKMIRA PHARMACEUTICALS CORP, $19.3, +7.34 pct
Shares of companies developing Ebola vaccines rose on Tuesday. Leading drugmakers plan to work together to accelerate development of an Ebola vaccine and produce millions of doses of the most effective experimental product for use next year.
J&J said it was accelerating work on its experimental Ebola vaccine and aims to produce 1 million doses next year, 250,000 of which are expected to be available by May.
J&J has already discussed collaboration with GSK, which is working on a rival vaccine.
Separately, Tekmira said it started limited manufacturing of its therapeutic targeting Ebola. The company said its RNAi therapeutic, which works by preventing virus from replicating, is part of its TKM-Ebola program and would be available by early December.
** NORTHERN TRUST CORP, $61.795, -5.61 pct
The custody bank reported a lower-than-expected third-quarter profit as it incurred higher expenses and earned lower foreign exchange trading income.
** BOULDER BRANDS INC, $9.751, -23.40 pct
The health and wellness food retailer was one of the top percentage losers on the Nasdaq. The company cut its adjusted profit forecast for the fourth-quarter, saying it expected lower shipments to its largest customer.
Boulder Brands, which has missed profit estimates for the past two quarters, said it expected third-quarter revenue and profit to fall due to slow sales of its Smart Balance spreads.
** NANOSPHERE INC, $0.485, -34.11 pct
The molecular diagnostics company said it would offer 40 million shares at 50 cents per share and expected net proceeds of about $18.4 million from offering.
The offering, priced at a 33 percent discount to the stock's Tuesday close, represents about 52 percent of the company's outstanding shares.
Nanosphere said on Tuesday that it terminated its previously announced common stock purchase agreement with Aspire Capital Group.
** LUMBER LIQUIDATORS HOLDINGS INC, $51.65, -10.38 pct
The lumber retailer reported a lower-than-expected third-quarter profit and forecast current-quarter earnings below the average analyst estimate. The company also said it expects full-year sales to drop at stores open at least a year.
** LPL FINANCIAL HOLDINGS INC, $40.04, -7.10 pct
The brokerage firm said it anticipated higher-than-expected charges related to regulatory issues to hurt its third-quarter earnings by 11 cents per share.
The company estimated quarterly adjusted earnings per share below the average analyst estimate. At least three brokerages, including Goldman Sachs and KBW, cut their price targets on the stock.
** OWENS CORNING, $31.98, +4.17 pct
The building product maker's third-quarter adjusted earnings of 63 cents per share beat the average analyst estimate of 49 cents. "Insulation and composites delivered strong performance in the third quarter," CEO Mike Thaman said in a statement.
** CREE INC, $27.919, -15.78 pct
At least seven brokerages cut their price targets on the light-emitting diode maker's stock by as much as $14 to as low as $28. The stock has a median price target of $33.50.
The company on Tuesday reported lower-than-expected quarterly profit and revenue and forecast current-quarter adjusted profit and revenue below the average analyst estimate due to weak demand for LEDs.
** UNISYS CORP, $23.57, +21.62 pct
The IT company on Tuesday posted a third-quarter profit compared with a year-earlier loss. Revenue rose 11 percent, driven by growth in its technology and services businesses.
** SIX FLAGS ENTERTAINMENT CORP, $38.98, +12.99 pct
The theme park operator on Tuesday reported better-than-expected third-quarter revenue, helped by an 8 percent rise in admissions revenue per capita.
** VMWARE INC, $82.53, -6.42 pct
The software maker forecast current-quarter revenue largely below Wall Street's estimates due to a delay in the closing of a large U.S. government deal and lower bookings in Germany, Russia and Japan in the third quarter.
** SUSSER PETROLEUM PARTNERS LP, $45.17, -2.71 pct
The motor fuel distributor said on Tuesday that it started an offering of 8 million units, representing about 36 percent of its total outstanding units. Susser intends to use the proceeds to repay debt under its revolving credit facility.
The company also said it expects third-quarter results to be hurt by non-cash charges of $2 million-$2.5 million related to Susser Holdings Corp's acquisition by Energy Transfer Partners LP.
** IROBOT CORP, $35.8, +13.26 pct
The robot maker's third-quarter profit nearly doubled and revenue and profit both beat analysts' average estimates. The company also raised its full-year profit forecast on Tuesday.
IRobot said orders in both its home as well as defense and security businesses that were originally expected in the fourth quarter were received and delivered in the third quarter.
** OCWEN FINANCIAL CORP, $19.82, -7.73 pct
Two brokerages cut their ratings on the mortgage servicing company's stock after New York state's financial regulator said on Tuesday that Ocwen may have harmed borrowers by sending them backdated letters about loan modifications and foreclosures.
Evercore downgraded the stock to "hold" from "buy," and BofA Merrill Lynch to "neutral" from "buy". Citigroup cut its target price on the stock to $23 from $32. The stock has a median target price of $29.
** SONIC CORP, $24.37, +3.39 pct
The drive-in restaurant chain operator's shares touched a seven-year high on Tuesday. At least four brokerages raised their price targets on the stock after the company's fourth-quarter sales beat the average analyst estimate.
"Sonic's unique drive-in experience, quality menu offerings and differentiated messaging continues to resonate with consumers and take share from larger QSR (quick service restaurant) peers," Wunderlich Securities, which raised its price target to $28 from $26, said in a note. (Compiled by Shailaja Sharma in Bangalore; Editing by Simon Jennings)