Electronic Arts in NEGOTIATION Mode and 4 Morning Hot Stocks Making Market Waves

Digital music will surpass physical media such as CDs and vinyl this year, according to research firm Strategy Analytics; revenues from digital music could rise to $3.4 billion overtaking the $3.38 billion from CD’s etc. Key beneficiaries of this trend could be companies such as Spotify and Pandora (NYSE:P), with streaming revenues in the U.S. likely to rise 28 percent in 2012 and downloads 6.7 percent.

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Comparable stores sales fall across the board at Sears (NASDAQ:SHLD) with domestic down 2.9 percent, Kmart down 4.7 percent and Sears Canada lower by 7.1 percent. Net losses nevertheless drop to $132 million from $152 million, though liquid assets total $3.1 billion including cash of $738 million.

Business-to-consumer e-commerce company E Commerce China Dangdang (NYSE:DANG) reports a $0.01 miss on its Q2 EPS of -$0.24. However revenues rise strongly by 53 percent y-on-y to $190.1 million, beating estimates by $4 million.

Clothing retailer Childrens Place (NASDAQ:PLCE)  reports strong outlet and e-commerce sales with comparable retail stores higher by 3.4 percent, though gross margins were under pressure due to higher merchandise costs and decline 190 bps to 31.7 percent of sales. Guidance for FY12: comparable retail sales growth in the low singles and EPS in the range $3.20 – $3.30 compared to previous guidance of $3.15 – $3.30.

Sources report that Electronic Arts (NASDAQ:EA) may be in talks with private equity players such as KKR and Providence Equity Partners for a sale of the company; according to rumors, an offer in the $20-a-share range could clinch the deal.

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