Today's In Play
07:29 PM Philip Morris International upgraded to Neutral from Reduce at Nomura (90.14 )
07:29 SUMRX Pound Slides on Dovish Comments from BoE Head King: 10-yr: -07/32..2.007%..USD/JPY: 93.57..EUR/USD: 1.3500
The Dollar Index is lower in early trade with action slipping below the 80.00 level. Current action is holding up near 79.95.
EURUSD is +40 pips at 1.3490 as trade remains on track for its third straight day of gains. The single currency has been climbing higher over the course of the morning, but has seen some help from the better than expected Eurozone industrial production (0.7% MoM actual v. 0.3% MoM expected) reading. Action is now testing near-term resistance in the 1.3500 area.
GBPUSD is -95 pips at 1.5565 following dovish comments from Bank of England Governor Mervyn King. Mr. King suggested inflation is likely to remain above the BoE's 2% target for the next two years and that the UK must find a way to boost overseas demand. Today's selloff has pushed sterling to a fresh six-month low. Click here to see a 5 minute GBPUSD chart.
USDCHF is +5 pips at .9170 as trade continues to hold just below the 50-day moving average. Trade over the past week has held in a tight range between .9150 and .9200, and has traders looking to play either side on a breakout. Data out overnight was limited to a cooler than expected PPI number (-0.1% MoM actual v. 0.2% MoM expected).
USDJPY is +15 pips at 93.60 as traders await tomorrow's Bank of Japan meeting. Reports suggest the central bank will lift its economic outlook and potentially put the brakes on further easing. The latest economic data showed Tertiary Industry Activity jumped 1.4% MoM (0.8% MoM actual) as the string of better than expected data continues.
AUDUSD is +25 pips at 1.0330 following a strong Westpac Consumer Sentiment survey (7.7% actual v. 0.6% prior). The hard currency raced to resistance in the 1.0360 area following the release, but action has drifted back towards the 200-day moving average (1.0310) as sellers defended the level. Today's gain has the aussie on track for its best close in a week. Chinese markets remained closed for the Lunar New Year.
USDCAD is +10 pips at 1.0030 with today's trade confined to a tight 30 pip range. The 200-day moving average (.9990) continues to aid parity as key support rests in the area.
07:29 AVP Avon Products upgraded to Neutral from Sell at UBS (20.79 )
07:28 AHS AMN Healthcare Services upgraded to Buy from Neutral at Sun Trust Rbsn Humphrey (11.48 )
07:28 DRI Darden Restaurants initiated with a Underperform at Credit Agricole (46.81 )
07:28 TSON Trans1 initiated with a Mkt Outperform at JMP Securities (2.52 )
07:26 UNM Unum Group upgraded to Buy from Neutral at Sun Trust Rbsn Humphrey (24.17 )
07:24 KCG Knight Capital Group and GETCO announce filing of S-4 Registration Statement with the SEC (3.70 )
Co and GETCO Holding announced that Knight Holdco, the new public holding co that will be the ultimate parent co of Knight and GETCO upon completion of their pending transaction, filed a Registration Statement on Form S-4 with the SEC. The Registration Statement includes a preliminary Joint Proxy Statement of Knight and GETCO and a preliminary Prospectus of KCG,, as well as other relevant documents concerning the proposed transaction. The Registration Statement has not yet become effective, and the information in it is subject to change.
07:22 OAK Oaktree Capital: Farallon Capital Partners discloses 5.5% passive stake in 13G filing earlier this morning (49.35 )
07:22 WIRES On The Wires
The U.S. Department of Agriculture has awarded Accenture Federal Services (ACN) a $2 mln, one-year contract to help the Food Safety Inspection Service continue improving the system that tracks data critical to the nation's meat and poultry food supply.
Conn's (CONN) announced the sale and long-term lease back of four owned properties to STORE Capital Acquisitions. The co received net proceeds of ~ $22.4 mln in connection with the sale, which was used to repay borrowings under its real estate loan and asset-based lending facility.
Garmin International, a unit of Garmin (GRMN) announced the GRA 5500, a high-performance, all-digital radar altimeter for transport category, helicopter, business and general aviation aircraft.
Freescale Semiconductor (FSL) has designed a fully integrated microcontroller solution that powers the second generation of Insulet's OmniPod.
Howard Hughes (HHC) announced that The Woodlands Development Corp., a wholly-owned subsidiary, will expand and redevelop The Woodlands Resort & Conference Center.
07:19 CMCSA Comcast: Color on qtr/NBC acquisition (38.97 )
Wunderlich raises its CMCSA tgt to $47 from $44 off what it views as a mispriced (from GE's vantage point) deal in selling its residual 49% NBCUniversal interest to Comcast for only $16.7bn - circa $39bn implied entity value with debt. (Comcast is also buying Rockefeller Center and Englewood, NJ real estate for $1.4bn.) Concurrent with the purchase and early strong Q4 results, Comcast also announced that it would repurchase $2bn in stock in 2013 and that it is raising its annual dividend 20% to $0.78 per share. Firm expects Comcast to remain very conservative on buybacks, but it now has ample flexibility with an estimated $43.4bn in 12.31.13 net debt against $21.2bn in estimated EBITDA.
Oppenheimer notes CMCSA reported 4Q12 results that exceeded expectations, primarily from strong cost-containment within the content segment. Overshadowing results was Comcast's acquisition of the remaining 49% equity interest in NBCU for $16.7B. Assuming $4.5B in proportionate debt, the transaction implies a FY12 EBITDA multiple of ~10x, a reasonable price, and looks to be FCF-accretive. Comparable media companies trade at ~9x EBITDA.
Hudson Squares notes CMCSA reported 4Q results that beat its estimates across the board. In the cable business, subscriber metrics beat in all three products and revenue and EBITDA beat by 1% and 3%, respectively. In the NBCU business, total revenue beat by 1% and EBITDA by 5%, with particular strength in the NBC broadcast network (strong NFL ratings in 4Q are not being repeated in 1Q so far) and with the home entertainment division of filmed entertainment (i.e. DVD sales).
As mentioned earlier, CMCSA was upgraded to Outperform from Neutral at Credit Suisse.
CMCSA is trading 8% higher in pre market at $42.09.
07:18 HSIC Henry Schein beats by $0.06, reports revs in-line; reaffirms FY13 EPS guidance (90.37 )
Reports Q4 (Dec) earnings of $1.26 per share, $0.06 better than the Capital IQ Consensus Estimate of $1.20; revenues rose 2.9% year/year to $2.41 bln vs the $2.4 bln consensus. Co reaffirms guidance for FY13, sees EPS of $4.81-4.91, excludes the one-time, non-cash charge of ~$0.04-0.05 per diluted share related to the refinancing of Butler Schein Animal Health debt, vs. $4.85 Capital IQ Consensus Estimate.
Stock Repurchase Plan
The co announced that it repurchased ~1.1 mln shares of its common stock during the fourth quarter at an average price of $79.50 per share, or ~$84.2 mln. The impact of the repurchase of shares on fourth quarter diluted EPS was immaterial. At the close of the fourth quarter, co had $300 mln authorized for future repurchases of its common stock.
07:17 DE Deere: DE trades with an early pre-market bid following qtrly. results, guidance; DE currently prints 95.70 vs. 93.98 settle
07:16 CRWS Crown Crafts reports Q3 EPS of $0.16 versus $0.16 in the same quarter as last year; revs fell 7% YoY to $20.07 mln (no ests) (5.34 )
07:16 DE Deere beats by $0.25, reports revs in-line; guides Q2 revs slightly below consensus; guides FY13 revs slightly above consensus (93.98 )
Reports Q1 (Jan) earnings of $1.65 per share, $0.25 better than the Capital IQ Consensus Estimate of $1.40; revenues rose 11.0% year/year to $6.79 bln vs the $6.74 bln consensus.
Deere equipment sales are projected to be up about 6 percent for fiscal 2013 and up about 4% for Q2 compared with the same periods of 2012.
Co issues slight downside guidance for Q2, sees Q2 revs growth of 6%, which equates to ~$9.78 bln vs. $9.83 bln Capital IQ Consensus Estimate.
Co issues slight upside guidance for FY13, sees FY13 revs growth of ~4%, which equates to ~$35.5 bln vs. $35.3 bln Capital IQ Consensus Estimate.
07:15 ACCO ACCO Brands reports EPS in-line, misses on revs; guides FY13 EPS in-line (8.40 +0.18)
Reports Q4 (Dec) earnings of $0.37 per share, in-line with the Capital IQ Consensus Estimate consensus of $0.37; revenues rose 51.0% year/year to $529.7 mln vs the $536.05 mln consensus. Co issues in-line guidance for FY13, sees EPS of $0.95-1.05 vs. $1.01 Capital IQ Consensus Estimate. The mid-point of the range assumes modest pro forma revenue growth, including sales synergies, and earnings improvement that is primarily driven by the realization of cost synergies and productivity improvements. The company expects to generate free cash flow of approximately $150 million.
07:15 TRI Thomson Reuters beats by $0.04, reports revs in-line (30.65 )
Reports Q4 (Dec) earnings of $0.60 per share, excluding non-recurring items, $0.04 better than the Capital IQ Consensus Estimate of $0.56; revenues rose 1% year/year to $3.36 bln vs the $3.36 bln consensus (+2% pro forma ex-FX).
Growth in Marketplaces and Governance, Risk & Compliance was offset by a decline in the Trading business. Investors revenues were unchanged from the prior-year period. Recurring subscription-related revenues decreased 1%. Transactions-related revenues increased 12% (-1% organic) due to acquisitions. Recoveries revenues were flat and Outright revenues increased 9%. Revenues from ongoing businesses were $3.4 billion, a 2% increase before currency.
Adjusted EBITDA increased 11% and the corresponding margin was 28.2% versus 25.8% in the prior-year period. The margin improvement was driven by the elimination of integration expenses, lower reorganization costs and continued cost containment, partially offset by flat organic revenue growth.
07:14 BXC Bluelinx reported Q4 adjusted loss of ($0.12) versus ($0.10) single Capital IQ estimate; revs rose 12.5% YoY to $440.3 mln (no rev estimate) (3.30 )
07:13 DUK Duke Energy beats by $0.06 (69.50 )
Reports Q4 (Dec) earnings of $0.70 per share, $0.06 better than the Capital IQ Consensus Estimate of $0.64. Co will provide updates on its businesses, report on regulatory initiatives, and offer a financial and business outlook for 2013 and beyond during Feb. 28 analyst meeting
"For 2012, adjusted EPS reflected the addition of earnings from Progress Energy, net of the impact of shares issued in connection with the merger, the impact of the new market-based Electric Security Plan (ESP) in Ohio, and unfavorable weather. These were partially offset by revised customer rates at Duke Energy Carolinas."
07:13 DELL Dell downgraded to Mkt Perform from Outperform at Bernstein (13.79 )
07:13 LO Lorillard beats by $0.03, beats on revs (39.72 -0.34)
Reports Q4 (Dec) earnings of $0.79 per share, $0.03 better than the Capital IQ Consensus Estimate of $0.76; revenues rose 7.5% year/year to $1.21 bln, excluding excise taxes, vs the $1.16 bln consensus. Lorillard's Board of Directors approved a 6.5% increase in its quarterly dividend to $0.55 per share.
07:12 SGEN Seattle Genetics downgraded to Hold at Needham on valuation; after a strong performance in 2012, firm sees less room for upside in 2013 (29.24 )
Needham downgrades SGEN to Hold from Buy. U.S. Adcetris sales of $35.4M were above its $34.0M and consensus $33.2M ests. Mgmt guided for $130-140M in 2013 Adcetris sales, somewhat less than expectations given prior guidance for flat on-label use from 2012 through 2013. Guidance reflects management expectations for minimal off-label use in 2013. The stock has performed well through 2012 into 2013, now reaching ~$3.2B EV. Although firm believes there is minimal downside risk to the stock, there may also be little upside going forward in 2013.
07:09 DF Dean Foods misses by $0.10, beats on revs; guides Q1 EPS below consensus; guides FY13 EPS below consensus (18.41 )
Reports Q4 (Dec) earnings of $0.20 per share, excluding non-recurring items, $0.10 worse than the Capital IQ Consensus Estimate of $0.30; revenues rose 3.7% year/year to $3.42 bln vs the $3.37 bln consensus. Co issues downside guidance for Q1, sees EPS of $0.22-0.27, excluding non-recurring items, vs. $0.30 Capital IQ Consensus Estimate. Co issues downside guidance for FY13, sees EPS of $1.00-1.10, excluding non-recurring items, vs. $1.25 Capital IQ Consensus Estimate.
Fourth quarter Fresh Dairy Direct operating income was $106 million, as compared to $107 million in the fourth quarter of 2011.
Fourth quarter Fresh Dairy Direct pro forma adjusted operating income was $102 million, a 2 percent increase from $99 million in the fourth quarter of 2011.
"Despite the challenging rise in costs in the back half of the year and fourth quarter in particular, fourth quarter gross profit per gallon was above third quarter and year ago levels,"
07:08 CTRN Citi Trends issues Q4 guidance (will report final results March 15) (13.38 )
Co sees Q4 EPS of ($0.07), may not compare to $0.34 consensus, includes $16 million decrease in sales during the last two weeks of January adversely impacting net loss per diluted share by ~$0.35. Co reports prelim Q4 sales of $175.7 mln vs $191.15 mln consensus. Fourth quarter comparable store sales decreased 11.8%. The largest impact on the comparable store sales for the fourth quarter was the delay by the Internal Revenue Service of 2012 tax refunds. The IRS moved back the date it would accept tax returns from January 13 a year ago to January 30 this year. As a result, all tax refund driven sales this year were pushed into fiscal 2013.
Comparable store sales in November increased 1%, continuing the slight positive trend that began in the third quarter. Comparable store sales in December decreased 10%. Comparable store sales in January dropped 28%. January comparable sales were actually up 10% for the first three weeks of the five-week month, benefiting from the calendar change. Sales the last two weeks dropped over $16 million due primarily to the timing of tax refund driven sales.
"While the sales results for the fourth quarter are disappointing, we continue to make very good progress in our turnaround efforts. There are several reasons for the disappointing sales in the fourth quarter and following is a fairly detailed explanation."
"Last week, we finally saw the beginnings of tax refund driven sales activity. Although we can't quantify the impact, we are hopeful that this activity will help produce a successful first quarter of fiscal 2013."
Outlook: "Looking forward to the first quarter of 2013, we expect sales to be negatively impacted by the calendar change mentioned above. We do expect some benefit from the tax refunds moving from late 2012 into 2013. But, we also know that our ladies' apparel business is still significantly challenged by the diminished brand sales. So, our outlook for the first quarter of 2013 remains cautious."
07:08 PRO Pros Holdings target raised to $30 from $25 at Northland Capital after another strong sales quarter in 4Q and financial results ahead of ests (22.20 )
07:08 WWAV WhiteWave Foods beats by $0.01, reports revs in-line; guides Q1 EPS below consensus; guides FY13 EPS in-line (16.41 )
Reports Q4 (Dec) earnings of $0.18 per share, excluding non-recurring items, $0.01 better than the Capital IQ Consensus Estimate of $0.17; pro forma rose 12.2% year/year to $609 mln vs the $610.44 mln consensus.
Co issues downside guidance for Q1, sees EPS of $0.14-0.16, excluding non-recurring items, vs. $0.17 Capital IQ Consensus Estimate.
Co issues in-line guidance for FY13, sees EPS of $0.68-0.72, excluding non-recurring items, vs. $0.71 Capital IQ Consensus Estimate. Building on its strong fourth quarter and full year 2012 results, the Company expects continued momentum in 2013.
On a percentage basis, mgmt anticipates pro forma adjusted net sales growth in the high-single digits for both first quarter and full year 2013. The Company anticipates that volume growth across its segments and platforms will be the primary driver of its top line growth, due to the continued growth of its existing products and augmented by a pipeline of new products it will be introducing to the marketplace in 2013. As a result of anticipated higher distribution and warehousing costs due to capacity constraints over the first half of the year, the Company expects pro forma adjusted total operating income percentage growth to be in the high-single digits for Q1, increasing to the mid-teens for the full year as production capacity is added and other cost reductions are implemented during the year. Due to strong historical growth and volume growth forecasted, management anticipates a continued burden on internal production capacity, as well as its distribution and warehousing network and therefore, is increasing its estimate of annual capital expenditures to a range of $150 million to $160 million for 2013, from a prior estimate of ~$125 million.
Planned spin-off by dean foods in May 2013
Dean Foods has affirmed its intention to effect a tax-free spin-off of shares of the co in May, following the April 23, 2013 expiration of its IPO lock-up period. Dean Foods announced it has received a private letter ruling from the Internal Revenue Service providing that, subject to certain conditions, the anticipated spin-off will be tax-free for U.S. federal income tax purposes. Dean Foods also announced plans to retain up to 19.9% of the total outstanding WhiteWave shares, or up to 34.4 million shares, with the intention to monetize or distribute the position in a tax-free manner at a later date.