Ultimate Market Recap: Buffet Backs Wal-Mart, Vertex Up 43%
Wall Street Watch: Warren Buffet’s Stardom, Yahoo Back to Alibaba
Stock News: Warren Buffett and Yahoo Dominate the Weekend
During Berkshire Hathaway’s (NYSE:BRKA) famous shareholder conference, Warren Buffet said he still supports Wal-Mart (NYSE:WMT) in the long run. As you’d expect, Warren thinks the short term scandal concerns are a buying opportunity.
Do you think Oreo’s are Kraft’s (NYSE:KFT) great American classic? Think again. Kraft is gearing up to expand new Oreo flavors to suit the tastes of different emerging markets. Some of the exotic new flavors include green tea, banana, and mango.
Barclays PLC (NYSE:BCS) will test the waters of the U.S. market by launching an online savings bank. The company’s executives have said the move will improve its ability to finance its American credit-card business without a reliance on the volatile wholesale markets. Barclays’s goal is to attract customers through 1 percent interest rates on deposits. Antony Jenkins, the chief executive of Barclays’ retail and business banking operations, said, “We want to grow our credit-card business over time in the U.S., so we want to make sure we can fund the growth. In this day and age, it’s always good to have diversity of funding.”
Yahoo (NASDAQ:YHOO) is allegedly negotiating to sell its 15 percent to 25 percent stake in Alibaba (ALBCF.PK) back to the company. This deal would bypass the complications that have stopped previous discussions between the two but Yahoo would pay a tax. But not so fast, the controversy over CEO’s Scott Thompson’s resume could make things difficult.
Europe Hates Austerity
After this weekend’s elections in France and Greece, the voters have spoken and have said no to austerity. In France, Francois Hollande took the presidency away from Nicolas Sarkozy, who represents the ninth European leader to be voted out of office in the last two years. Over in Greece, two pro-bailout parties achieved only 32 percent of the vote, down from 2009’s 80 percent. The political changes are expected to affect the euro and the health of the eurozone.
EU Economic Commissioner Olli Rehn on Saturday suggested that the eurozone may give its recession-plagued members some flexibility with the compliance of deficit rules as a way to try and jump start some growth. He laid out several measures for the troubled zone but said, “The pact entails considerable scope for judgment…when it comes to its concrete application.”
5 Early Buzzers: AIG Sinks 6%, Vertex Surges 53%
Shares of American International Group Inc. (NYSE:AIG) fell more than 6 percent early Monday morning. The Treasury department recently announced a public offering of AIG common stock. The insurer announced it is committed to take $2 billion of the offering sold at the IPO price.
Avis Budget Group Inc. (NYSE:CAR) shares declined in pre-market trading. The company reported a loss of $23 million (22 cents per share) for the first-quarter, compared to a net income of $7 million (6 cents per share) a year earlier.
Don’t Miss: Uncle Sam Prepares to Dump AIG Shares
Vertex Pharmaceuticals Inc. (NASDAQ:VRTX) shares surged 53 percent before the opening bell. The drug company’s new cystic fibrosis drug led to significant improvement in lung function when combined with experimental treatment. “These improvements were clinically very, very meaningful for these patients. This is really a game-changing combination therapy,” explained Brian Skorney, an analyst with Brean Murray, Carret & Co., according to Reuters.
Talbots Inc. (NYSE:TLB) shares jumped 2.16 percent in early trading. On Monday, the company announced it received a $3.05 per share buyout offer from Sycamore Partners, a private equity firm.
Shares of Tyson Foods Inc. (NYSE:TSN) declined nearly 2 percent in pre-market trading. The company said second-quarter profit came in at $166 million (44 cents per share), compared to $159 million (42 cents per share) a year earlier. Revenue in the quarter increased 3 percent to $8.27 billion, below estimates of $8.47 billion.
Investor Insight: Here’s Why Green Mountain’s Cup is Half Empty
Vertex, GTSI, Insmed, DISH Most Active Stocks in Monday Morning Trading
Vertex Pharmaceuticals Inc (NASDAQ:VRTX): Vertex announced an interim analysis of data from an ongoing Phase 2 study of VX-809 and KALYDECO that showed significant improvements in lung function among adults with cystic fibrosis who have two copies of the most common mutation in the cystic fibrosis transmembrane conductance regulator gene, F508del. A planned interim analysis was conducted after approximately half of the study patients had completed 56 days of treatment. Today’s results are based on data from 37 homozygous F508del patients who completed treatment in the 56-day study and 11 patients with one or two copies of the F508del mutation who received placebo. There was a statistically significant improvement in lung function across the combined treatment groups relative to baseline compared to placebo. Of those who received VX-809 and KALYDECO, approximately 46 percent experienced an absolute improvement from baseline to Day 56 in lung function of 5 percentage points or more, and approximately 30 percent experienced an absolute improvement from baseline to Day 56 of 10 percentage points or more. None of the patients treated with placebo achieved a 5-percentage point or more improvement from baseline to Day 56 in lung function. Most adverse events were mild or moderate in severity and comparable between treatment and placebo groups. Shares of Vertex Pharmaceuticals Incorporated are trading 43.76% higher today.
Cognizant Technology Solutions Corp (NASDAQ:CTSH): The five major India-based IT services providers grew 23.8% last year, compared with 7.7% for the IT services market worldwide, according to Gartner, Inc., reports the Economic Times. Cognizant (NASDAQ:CTSH) passed Wipro to become the third largest Indian IT services provider, as it had the highest growth rate of 33.3% amongst the top five which also include TCS, Infosys (NASDAQ:INFY)and HCL Technologies. Shares of Cognizant Technology Solutions Corp are trading 18.04% lower today.
GTSI Corp. (NASDAQ:GTSI): GTSI Corp. has entered into a definitive agreement to be acquired through a cash tender offer at $7.75 per share by an affiliate of UNICOM Systems in a transaction with an expected total value of approximately $76.67M. Under the terms of the agreement, which was unanimously approved by a special committee of independent GTSI directors and GTSI’s full Board of Directors, the tender offer is not subject to any financing contingencies. The per share purchase price of the tender offer represents a premium of approximately 47.9% over GTSI’s closing stock price as of May 5, 2012 and approximately 65.6% over its one-year average closing stock price. Under the terms of the definitive merger agreement, GTSI is permitted to solicit alternative acquisition proposals from third parties through June 6, 2011 and intends to consider any such proposals. Shares of GTSI Corp. are trading 47.14% higher today.
Insmed Incorporated (NASDAQ:INSM): Insmed announced that the FDA has lifted the clinical hold previously placed on ARIKACE in Cystic Fibrosis patients with Pseudomonas lung infections. Insmed has reached agreement with FDA on a revised CF clinical trial population consisting of adult patients who have chronic Pseudomonas lung infections and FEV-1 % predicted between 25% and 75%. The company is continuing discussions with the agency in an effort to finalize additional details of the phase 3 study protocol for the potential clinical trial. At the same time, the company is evaluating possible next steps for the ARIKACE U.S. CF clinical program given the current progress and anticipated resource requirements of the ongoing ARIKACE CF and U.S. non-tuberculous mycobacteria clinical programs. Shares of Insmed Incorporated are trading 58.15% higher today.
DISH Network Corp. (NASDAQ:DISH): This compares to approximately 58,000 additions in Q1 of 2011. DISH Network ended the latest quarter with approximately 14.071M subscribers. Shares of DISH Network Corp. are trading 2.62% lower today.
Trader Radar Action: Petmed, Broadsoft, Tyson Foods, Echostar May 7th
Petmed Express Inc (NASDAQ:PETS): Reported Q4 revenue $55.9M versu consensus $52.05M. Shares of Petmed Express Inc are trading 15.84% lower today.
BroadSoft Inc (NASDAQ:BSFT): Reported Q1 revenue $38.3M versus consensus $36.97M. Shares of BroadSoft Inc are trading 16.9% lower today.
Tyson Foods, Inc. (NYSE:TSN): Consensus is $1.98. Says beef “rebounding”. Sees hog supplies up 1%-2% year-over-year for the balance of the FY. Says pork margin performance should remain strong through 2H, but does not expect it to be at the levels we achieved in the first six months. In prepared foods, says will continue to look for opportunities to acquire or build new assets to expand in several other categories or to increase capacity in existing categories. Shares of Tyson Foods, Inc. are trading 3.44% higher today.
Echostar Corporation (NASDAQ:SATS): Reported Q1 revenue $765M versus one estimate $876.16M. Shares of Echostar Corporation are trading 4.18% lower today.
Market Recap: Disney’s Revenge, Google’s Guilt, and More
Markets closed mixed on Wall Street today: Dow -0.23%, S&P +0.04%, Nasdaq +0.5%, Oil -0.35%, Gold -0.56%.
On the commodities front, Oil (NYSE:USO) declined to $97.97 a barrel. Precious metals also declined, with Gold (NYSE:GLD) falling to $1639.20 an ounce while Silver (NYSE:SLV) fell 0.36% to settle at $30.02.
Hot Feature: Why is Warren Buffett Hungry for Acquisitions?
Here’s your Cheat Sheet to today’s top stock stories:
Disney’s (NYSE:DIS) movie, “The Avengers” opened over the weekend and dominated the box office from Friday to Sunday with an estimated $200.3 million in sales. This represents the biggest movie premiere in U.S. history. The previous record had been held by the last Harry Potter sequel. Potter’s opening weekend in 2011 saw almost $170 million from sales. Disney closed up 2.07% today to $43.82.
AIG (NYSE:AIG) dipped 3.4% to $31.73. The stock was under pressure after the insurer said the Treasury Department priced shares at $30.50 a share — the latest in a series of offerings of its stock. This time, the government’s putting up 163.9 million shares for sale as Washington continues to whittle down its equity from AIG’s 2008 bailout.
A mixed verdict was delivered in Oracle’s (NASDAQ:ORCL) patent suit against Google (NASDAQ:GOOG). The jury found Google guilty of violating Oracle copyrights by using Java APIs in Android, but found Google not guilty on other counts. Google is asking for a mistrial on account of the jury’s inability to answer a question regarding fair use of Oracle’s APIs.
With Intel (NASDAQ:INTC) expecting another record year in 2012, the company will increase its quarterly dividend by 7% to 22.5 cents a share, starting with the payout that will be declared for Q3. CEO Paul Otellini says the company is experiencing “strong demand in our core business and significant progress in smartphones and other new growth areas.”
6 Stocks Hitting Radars: EA Drops 9%, Rackspace and Dendreon Shares Crash
Shares of Electronic Arts (NASDAQ:EA) dropped more than 9 percent after the closing bell. The video game maker reported it earned $400 million ($1.20 per share) for the fourth-quarter, compared to $151 million (45 cents per share) a year earlier. However, the company lowered its outlook and is expecting a loss of 40 cents to 45 cents in the fiscal first-quarter, compared to estimates for a loss of 33 cents.
WYNN Resorts Ltd. (NASDAQ:WYNN) fell 1.3 percent in late trading. The casino company earned $140.6 million ($1.23 per share) in the first-quarter, compared to $173.8 million ($1.39 per share) a year earlier. Revenue increased 4.2 percent to $1.31 billion.
Rackspace Hosting Inc. (NYSE:RAX) shares plummeted 11.5 percent in extended-trading hours. The company reported net income of $23 million (10 cents per share) for the first-quarter, but missed estimates of 17 cents per share. “While we’ve made a lot of progress so far in 2012, we have much more to do. We are executing through a very important platform shift to our next generation cloud, and we need to make this experience incredible for our customers. Massive technology disruptions like this create once in a lifetime opportunities for companies to seize the moment, take the initiative, and lead the revolution. Our goal is to lead the revolution,” said Lanham Napier, chief executive officer.
Despite closing 4.3 percent higher during regular trading, MAKO Surgical Corp. (NASDAQ:MAKO) shares crashed 30 percent after the closing bell. The company reported a first-quarter loss of 28 cents per share. Analysts were expecting a loss of 20 cents per share.
Shares of Vivus Inc. (NASDAQ:VVUS) declined 1.6 percent in late trading. The company reported a first-quarter loss of $18.8 million (20 cents per share), compared to a loss of $9.9 million (12 cents per share) a year earlier.
Although Dendreon Corp. (NASDAQ:DNDN) reported better-than-expected results for the first-quarter, shares dropped 10 percent after the closing bell. The biotech company reported a net loss of $103.9 million, compared to a net loss of $112.8 million a year earlier.
Investor Insight: Warren Buffett and Charlie Munger Tag Team Gold