Carnival Loses Passengers, Lowers Revenue Estimate and 2 Other Hot Stocks to Watch

Carnival Corp. (NYSE:CCL): Current price $34.92

Carnival is not only losing passengers this year even with reduced prices, but its fortunes are also tied to what is going on in the eastern Mediterranean. All this is causing the number-one cruise company in the world to lower its revenue estimates by 3 percent for 2013, which is below its previous forecast. The company posted a $934-million profit for June through August, but that was down by 30 percent year-over-year.

Earnings came to $1.20 per share, down from $1.71 for the same period. Revenue for the quarter increased by less than 1 percent to $4.7 billion, and expenses outstripped growth. Beyond that, Carnival took $176 million in charges connected with two ships in its Costa line that are being taken out of service.

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Bank of America Corp. (NYSE:BAC): Current price $14.17

Bank of America is being instructed by an administrative law judge with the Department of Labor to pay black job applicants over $2 million in back wages and interest to resolve a discrimination case. A statement from the agency said the bank applied unfair and inconsistent selection criteria, causing the rejection of qualified black applicants for teller and entry-level clerical and administrative positions, and the ruling affects 1,147 applicants. The decision awards $964,033 to 1,034 applicants who were turned down for jobs in 1993 and $1,217,560 to 113 individuals who were rejected between 2002 and 2005.

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Applied Materials Inc. (NASDAQ:AMAT): Current price $17.14

It was announced Tuesday that the world’s top producer of chipmaking equipment will acquire its rival Tokyo Electron Ltd. in an all-share transaction, forming a company having a combined stock market value of $29 billion. It is anticipated that the surprise purchase will strengthen their position in a maturing industry where growth opportunities have become more rare. Senior analyst David Rubenstein at Advanced Research Japan observed that, “The industry is not high-growth anymore, so you are seeing some consolidation.”

For each existing share, Tokyo Electron shareholders will receive 3.25 shares of the as yet unnamed new company, and Applied Materials shareholders will receive 1 share, leaving the latter with around 68 percent ownership. The parties expect the transaction to close in the middle to second half of 2014.

 

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