Shares of U.S. mortgage giants Freddie Mac (FRE) and Fannie Mae (FNM) are lower due to concerns that their rescue plan might hurt the equity stakes of current shareholders, according to Reuters newswire.
New York Post reports that Lehman Brothers (LEH) CEO Dick Fuld is seriously mulling a way to take itself private and out of the public eye. According to sources, NYP says talks internally centering on privatizing LEH have gotten very serious consideration after a blistering onslaught of rumors and questions about the firm's solvency have caused the venerable bond shop to shed more than 79% this year. S&P maintains hold.
Wachovia (WB) wavered up and down after Oppenheimer downgrades WB to underperform from perform.
Kimberly-Clark (KMB) falls after the company posts $1.03, vs. $1.04, second quarter preliminary adjusted EPS despite 11% higher revenue. Preliminary adjusted EPS guidance was $1.08-$1.11; KMB says shortfall driven primarily by rapid escalation in costs in the second quarter. It cuts $4.45-$4.60 2008 EPS guidance to $4.20-$4.30, cites significant increase in cost inflation. S&P maintains buy. Wachovia downgrades to market perform from outperform.
General Motors (GM) announces that it is suspending quarterly dividend, effective immediately. Through a number of internal operating changes and other actions, including further headcount reductions, GM expects to generate about $10 billion of cumulative cash improvements by the end of 2009. In addition to these operating changes and other actions, GM expects to raise additional liquidity of $4-$7 billion through asset sales and financing activities.
Johnson & Johnson (JNJ) posts better-than-expected $1.17, vs. $1.05 a year ago, second quarter EPS on 8.7% sales rise. Raises 2008 EPS guidance to $4.45-$4.50, which does not include impact of any in-process R&D charges or other special items.
Genentech (DNA) posts $0.82, vs. $0.78 a year ago, second quarter non-GAAP EPS on 8% revenue rise. U.S. product sales rose 9%. Sees 2008 non-GAAP EPS guidance to $3.40-$3.50, vs. previous guidance of $3.35-$3.45.
WMS Industries (WMS) is up 2.08 to 28.50 after Oppenheimer believes business trends remain strong for WMS, BYI and IGT, despite modestly lower gaming revenues in most U.S. markets during the June quarter; reiterates outperform. WMS unavailable.
Evergreen Solar (ESLR) enters into a new long-term sales contract valued at about $1.2 billion with German-based IBC Solar AG. This contract extends through 2013 and brings ESLR's total contractual backlog to nearly $3 billion with five customers. S&P maintains strong buy.
Coldwater Creek (CWTR) raises second quarter guidance to breakeven-to-$0.02 EPS on sales of $235-$240 million, from previous guidance of $0.03-$0.09 loss on $215-$239 million sales. For fiscal year 2008, CWTR now sees $0.04 loss-to-$0.09 EPS on sales of $1,105-$1,151 million, from prior guidance of $0.13 loss-to-$0.04 EPS on $1,085-$1,150 million.
