Earning Plays

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Thursday, Sept. 11
CORRECT: Franklin downgraded by Sandler O'Neill(4:48 pm ET)
NEW YORK (MarketWatch) -- Franklin Resources (BEN: news, chart, profile) saw its stock downgraded by Sandler O'Neill & Partners on Wednesday to hold from buy. Sandler O'Neill also cut its Franklin earnings estimates for the fourth quarter, to $1.55 a share from $1.63 a share. It said the downgrade was due in large part to the stronger dollar. "Though we continue to believe [Franklin's] first-mover advantage in key overseas markets represents an important differentiating factor in the long run, our change in thinking largely reflects a more problematic assets under management/earnings growth story related to the ongoing rally in the dollar," said Sandler O'Neill in a research note. About 40% of Franklin's assets under management are in non-U.S. holdings. Sandler O'Neill also increased its projection for net outflows from funds in the fourth quarter, to $8 billion from $3 billion, pointing in part to poor performance of Templeton's four largest stock funds, Growth (TEPLX: news, chart, profile) , Foreign (TEMFX: news, chart, profile) , World (TEMWX: news, chart, profile) and Developing Markets (TEDMX: news, chart, profile) , all of which are in the bottom half of their peer groups. (Corrects name and ticker of Templeton funds)
Hurricane Ike continues to pack 100 mph winds(11:09 am ET)
NEW YORK (MarketWatch) -- Hurricane Ike continues to pack maximum winds of 100 miles per hour or more as a Category 2 storm on the Saffir-Simpson scale, with the storm centered about 470 miles east-southeast of Galveston, Texas, the National Hurricane Center said in its 11 a.m. ET update. Coastal storm flooding of up to 20 feet above normal tide levels can be expected near where the center of Ike makes landfall this weekend. Ike is moving over open water at a rate of about 10 miles per hour, with the center of the storm nearing the coast late Friday.
Energy shares fall with broad market(9:39 am ET)
NEW YORK (MarketWatch) -- Energy shares fell with the broad market on Thursday. The Amex Oil Index (XOI: news, chart, profile) subtracted 0.9% to 1,176, close to its 52-week low of 1,142. The Amex Natural Gas Index (XNG: news, chart, profile) subtracted 1.4% to 525. PetroBras (PBR: news, chart, profile) fell 1.7% to $38.94, reversing gains by the stock in overseas trading on a new offshore oil discovery.
CORRECT: Campbell's Soup Q4 net rises 46%(9:31 am ET)
NEW YORK (MarketWatch) -- Campbell Soup Company (CPB: news, chart, profile) said Thursday fourth-quarter net income rose 46% to $89 million, or 24 cents a share, from $61 million, or 16 cents a share in the year-ago period. Adjusted earnings for the Camden, N.J.-based food giant increased to 26 cents a share from 14 cents a share, after absorbing the impact of its Godiva unit sale. Net sales rose to $1.7 billion from $1.5 billion. Wall Street analysts expected earnings of 25 cents a share and revenue of $1.7 billion, on average. Looking ahead, Campbell Soup expects 2009 adjusted profit to increase by about 5% to 7%. (Updated to reflect sale of Godiva.)
Krispy Kreme narrows second-quarter loss(8:27 am ET)
NEW YORK (MarketWatch) -- Krispy Kreme Doughnuts Inc. (KKD: news, chart, profile) said Thursday that it narrowed its second-quarter loss to $1.9 million, or 3 cents a share, from $27 million, or 42 cents a share, in the year-ago period, which included a 35-cent charge. Revenues for the three months ended Aug. 3 decreased 9.5% to $94.2 million compared to $104.1 million. Krispy Kreme shares closed Wednesday at $4.00.
Lululemon Athletica net income doubles(7:47 am ET)
NEW YORK (MarketWatch) -- Lululemon Athletica Inc. (LULU: news, chart, profile) on Thursday said second-quarter net income doubled to $11.1 million, or 16 cents a share, from $5.1 million, or 7 cents a share in the year-ago period. Adjusted earnings rose to 18 cents a share from 8 cents a share. Revenue rose 48% to $85.5 million. Wall Street analysts expected earnings of 14 cents a share for the clothing retailer, according to a survey by FactSet Research. Founder and Chairman Dennis J. Wilson set plans to transfer about $11 million in restricted stock to an undetermined number of founding employees.
Methode Electronics profit drops 18% on revamp costs(6:38 am ET)
LONDON (MarketWatch) -- Methode Electronics (MEI: news, chart, profile) said first-quarter to Aug. 2 net income fell 18% to $6.8 million, or 18 cents a share, from $8.3 million, or 22 cents a share. The Chicago, IL.-based manufacturer of component and subsystem devices used in sensing and optical technologies said the decrease was due to higher restructuring charges associated with its U.S.-based automotive operations. The quarter included 9 cents a share of restructuring charges.
Sun Hung Kai Properties full year net income up 30%(5:40 am ET)
HONG KONG (MarketWatch) -- Sun Hung Kai Properties (HK:16: news, chart, profile) (SUHJY: news, chart, profile) said Thursday its full year net income climbed 30% on gains from investment property revaluations and the sale of equity investments. The firm, Hong Kong's largest developer by market capitalization and landlord of the city's 88-story International Finance Center, said its net profit for the year ending June 30 was HK$27.60 billion ($3.54 billion), up from HK$21.23 billion a year earlier. Sun Hung Kai said its underlying profit, or that which excludes revaluation gains, climbed 6% to HK$12.19 billion from HK$11.50 billion. Revenue attributable to property sales fell 32% to HK$11.5 billion from HK$16.9 billon. The company declared a final dividend of HK$1.70 per share, up from HK$1.60 a year earlier.
Home Retail comparable sales decline(2:22 am ET)
LONDON (MarketWatch) -- Home Retail Group (UK:HOME: news, chart, profile) said Thursday that sales at its Argos stores fell 1.6% in the fiscal second quarter to 927 million pounds ($1.63 billion). Comparable sales at the stores were down 5.8% due to lower sales of furniture and homewares. At the group's Homebase stores, total sales fell 0.3% to 389 million pounds and comparable sales dropped 8.3%. The group said its focus on cost control should result in profit for the first half being in line with its expectations. Profit for the year will be highly dependent on the Christmas trading period, it added.
Spartech net off 50%; will close a Michigan plant(2:11 am ET)
TEL AVIV (MarketWatch) -- Spartech Corp., (SEH: news, chart, profile) the St. Louis producer of thermoplastic sheet materials, thermoformed packaging and other products, reported fiscal third-quarter earnings fell 50% on 3% lower sales and said it would close a plant in St. Clair, Mich. For the quarter ended Aug. 2, Spartech earned $4.4 million, or 15 cents a share, against $8.8 million, or 27 cents, in the year-earlier period. The latest adjusted earnings were 16 cents. Revenue fell to $350.3 million from $361.1 million. The company said in a statement late on Wednesday that it would transfer the St. Clair production to other operations. The move will require $600,000 of restructuring costs and save $2 million annually, Spartech said. "While we expect continued soft demand" from customers' end markets, SPE sees initial signs that raw-material prices are stabilizing and expects some reductions in the rest of 2008, President and Chief Executive Officer Myles S. Odaniell said in the statement.
Wednesday, Sept. 10
Rockwell backs 2008 profit view of $4.05 to $4.10 a share(4:23 pm ET)
SAN FRANCISCO (MarketWatch) -- Rockwell Collins Inc. (COL: news, chart, profile) on Wednesday reaffirmed its fiscal 2008 net income outlook of $4.05 to $4.10 a share on revenue of $4.75 billion, despite strikes at two of its largeset customers, Hawker Beechcraft and Boeing. The company said if the Boeing strike lasts about 45 days, the impact of both strikes will result in a sales decline of about $40 million, of which $30 million is expected in the fourth quarter. In 2009, Rockwell Collins expects earnings between $4.35 to $4.55 a share and revenue of $5.05 billion to $5.1 billion. Analysts projected the company to report earnings of $4.10 a share on revenue of $4.77 billion in 2008 and earnings of $4.40 a share and $5.1 billion in revenue in the following year.