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Threat of Gov’t Shutdown Looming; BBRY & JCP in Focus; Fruit or Fries at McDonald’s?

Dan Berman
Hot Stock Minute
Threat of Gov’t Shutdown Looming; BBRY & JCP in Focus; Fruit or Fries at McDonald’s?

Two companies, both on the brink, have made major announcements this morning. We're talking about BlackBerry (BBRY) and J.C. Penney (JCP). BlackBerry has just released a quarterly report where losses were less than expected, but dismal nevertheless. The news has sent shares more than 2% higher. As for J.C. Penney, it's down 7% on details of a massive share sale. We have more on both companies in our "stocks to watch" section, But now the latest on a government shutdown, which could come Tuesday. Yahoo Finance Senior Columnist Mike Santoli has more in the video above.

A new window of opportunity may be about to open for Alan Mulally. All Things D reports the Ford (F) CEO has quote, "vaulted to the forefront of candidates to replace Steve Ballmer at Microsoft (MSFT). The software company announced last month that Ballmer would be leaving within a year. Another potential replacement is Stephen Elop who's rejoining the company from Nokia (NOK). Microsoft shares have been down 1.5% since Ballmer's impending departure was made public. They're up 8% year-to-date.

Panasonic is selling an 80% stake in its health care unit to private equity firm KKR (KKR). Panasonic will use the money-- about $1.7-billion-- to help cover massive losses from its TV business. Shares of KKR have been up 31% so far this year, giving the company a market cap over $14-billion.

Do you want fruit with that? Believe it or not, you could soon hear that question at McDonald's (MCD). The world's largest burger chain says it's going to start offering fruits and vegetables with its value meals as an alternative to fries. The move comes just days after smaller rival Burger King rolled out low-fat fries. As for McDonald's, its shares are now up 9% year-to-date.


BlackBerry (BBRY) released its quarterly report this morning. Losses were less than expected at 47-cents a share versus estimates of 49-cents. However, the company came in a bit shy on revenue at $1.57-billion versus $1.61-billion. CEO Thorsten Heins expressed his disappointment in a press release. But the company has canceled the traditional conference call with analysts. On Monday, BlackBerry said it agreed in principle to be acquired by its largest shareholder, Fairfax Financial for $9 a share.

J.C. Penney (JCP) is now down more than 7% in early trading. The company revealed more details this morning of a share sale which it announced yesterday. JCP plans to sell 84-million shares at a price of $9.65. That's where shares are trading now on the announcement. The whole situation is really a bit confusing. Yesterday CEO Mike Ullman said liquidity levels were fine. It was after the close, the company appeared to reverse course, with news of the share sale. J.C. Penney stock is now down 22% in the past week. Shares have plunged 50% since the start of the year.

Nike (NKE) is up more than 6% since yesterday's close and hit a new all-time high. The race to the top comes on quarterly earnings of 86-cents a share. That ran past estimates of 78-cents. Revenue that was basically in line with expectations at nearly $7-billion. Sales were up by $500-million over last year, and profits rose by more than 1/3 in that time. Nike says it's seeing strong demand for its athletic gear both here and abroad. The company's basketball and running categories performed particularly well. Even ahead of this morning's gains Nike stock was up 36-percent year-to-date.

Also reporting this morning is a company that moves a lot of Nike merchandise: Finish Line (FINL) which is up as much as 11% in early trading. Finish Line beat estimates posting profits of 54-cents a share when estimates were for 45-cents. Sales were $10-million more than expected at $436-million. Finish Line is up 19%, which is just about half of Nike's climb.