Ultimate Market Recap: Medtox Makes Good, BofA Holds Out on Shareholders

Wall St. Brief: Facebook’s NEW Demo Target, BofA Execs DUPED Shareholders

Facebook (NASDAQ:FB) is supposedly developing technology that would allow under-13 year olds with parental supervision use of the website, reported The Wall Street Journal. Presently, children under that age are banned from opening accounts on the social networking site, but an estimated 7.5 million use the site – after lying about their ages – with 5 million coming from those under 10-years-old.

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Chesapeake’s (NYSE:CHK) hedge sales against low gas prices in October spurred the company’s cash crunch and now it basically is unprotected against low gas prices in 2012. According to The Wall Street Journal, it has estimated losses of around $750 million to 900 million. Usually Chesapeake has generally been successful with these bets, but this time it may have been best to stay as an exploration company than a hedge fund.

Over a year ago, a small group of investors, CtW Investment, warned JPMorgan’s (NYSE:JPM) top executives that it was necessary to upgrade its risk controls, according to Seeking Alpha. After not doing so, two proposals, which included the chief risk officer having more power to look over CIO trades and enhancing the board’s risk management committee, are now quickly being implemented at the bank.

In the days prior to Bank of America’s (NYSE:BAC) shareholders approving the bank’s $50 billion Merrill Lynch acquisition, the bank’s executives had been told that Merrill’s losses would affect the combined companies’ earnings for years, but decided to not share this news with shareholders. Court documents have disclosed this information and will now probably pressure federal officials to make key managers responsible for actions.

Proxy advisor ISS has recommended that AOL Inc. (NYSE:AOL) shareholders vote for two of the three activist investor Starboard Value candidates. ISS said that AOL’s Patch local news network may need more time but “getting the business model right is (probably) more important than blanketing the landscape.”

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Early Buzzers: Chesapeake Cleans House, Facebook Shares Bleed

Shares of Chesapeake Energy Corp. (NYSE:CHK) gained more than 3 percent before Monday’s opening bell. The natural gas giant agreed to replace four members of its nine-member board, due to pressure by investor Carl Icahn. “We greatly appreciate the substantial contributions of all of our directors, but recognize our shareholders’ desire for change,” director Merrill Pete Miller said in a prepared statement Monday. Aubrey McClendon will stay the company’s chief executive officer.

Walgreen Co. (NYSE:WAG) shares jumped 2 percent in pre-market trading. Reports indicate that Walgreen and Express Scripts (NASDAQ:ESRX) have canceled legal claims made against each other. Walgreen issued a statement explaining, “The parties have agreed to dismiss their respective claims, and no other action has been or will be taken by either party with respect to this case. These dismissals have no impact on the parties’ ability or inability to come to terms on a pharmacy agreement.”

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Facebook (NASDAQ:FB) shares fell 1.7 percent in early trading. The social-media company continues to have problems finding a significant bottom. AllThingsD reported late Sunday that Facebook and Yahoo! Inc. (NASDAQ:YHOO) are in talks to settle their patent litigation.

Walt Disney Co. (NYSE:DIS) shares edged slightly lower in early Monday trading. The company raised its price of one-day single-park ticket to $89 this past weekend, representing a 4.7 percent increase.

Despite receiving a price downgrade, shares of McDonald’s Corp. (NYSE:MCD) traded mostly flat this morning. Deutsche Bank reduced its price target on the fast-food company from $108 to $100, citing European slowdown concerns impacting margins.

Investor Insight: Analyst’s Prophetic Prediction: Apple Can Sell This Many Million TVs

Wall Street Week Ahead: Fed’s Beige Book, Dollar General and Lululemon Earnings

After spending the short week waiting for jobs numbers, it’s back to business in this first full week of June as market watchers will focus on developments from Europe and the Federal Reserve. On Monday, German Chancellor Angela Merkel will meet with European Commission President Jose Manuel Barroso in Berlin prior to the late June meeting in Brussels with European leaders.

Greece’s problems will also be at the forefront as investors will keep their ears open on whether the country will remain in the euro zone. According to MarketWatch, recent polls have shown that Greek voters want a favorable revision for its financial bailout package terms and to remain in the euro zone. On June 17, the country will vote in a another parliamentary election after May’s vote did not create a coalition government.

Back in the U.S., the week will be a lighter one with economic numbers. On Thursday, Federal Reserve Chairman Ben Bernanke will testify before Congress at the Joint Economic Committee on economic outlook and monetary policy. Will he give any hints about QE3?

Take a look at the week ahead.

Economic numbers

Monday: April factory orders.

Tuesday: May ISM services PMI.

Wednesday: First-quarter productivity (revised) and first-quarter unit labor costs (revised).

Thursday: Weekly jobless claims and April Consumer credit.

Friday: April Trade Deficit and April wholesale inventories.

Fed Speak

Wednesday: Beige Book, Fed Governor Daniel Tarullo testifies at the Senate Banking Committee on the Dodd-Frank Act and Fed Vice Chair Janet Yellen gives an economic outlook and monetary policy speech.

Thursday: Fed Chairman Bernanke testifies before the Congressional Joint Economic Committee.


Monday: Dollar General (NYSE:DG).

Tuesday: United Natural Foods (NASDAQ:UNFI), Walgreen (monthly) (NYSE:WAG), Christopher & Banks (NYSE:CBK) and Bob Evans Farms Inc. (NASDAQ:BOBE).

Wednesday: Hovnanian Enterprises (NYSE:HOV), Pep Boys (NYSE:PBY), Men’s Warehouse (NYSE:MW), Brown-Forman (BF.A and BF.B) and Annie’s (BNNY).

Thursday: Lululemon (NASDAQ:LULU), Quiksilver (NYSE:ZQK), Rite Aid (monthly) (NYSE:RAD) and J.M. Smucker (NYSE:SJM).

Friday: Piedmont Natural Gas (NYSE:PNY), Ferrellgas (NYSE:FGP) and McDonald’s (monthly) (NYSE:MCD).

Apple and Facebook Sell Off at the Center of These HOT STOCK MOVERS

Bank of America (NYSE:BAC): Only a few days before shareholders were to approve Bank of America’s $50B Merrill Lynch purchase, the bank executives were warned that Merrill’s losses would hit both companies’ earnings for years to come. The bank, however, did not release this information to shareholders. The court documents that were filed yesterday have shed new light should place pressure on federal officials to hold important executives accountable for the situation. Shares of Bank of America are trading 1.92% lower today.

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Apple Inc. (NASDAQ:AAPL): According to Topeka’s Brian White, Tiawanese sources reveal that Apple’s next iPhone and a 7.8″ iPod mini is expected to be launched in September. White maintains a $1,111 PT on Apple, and he believes the new iPhone will feature a unibody, aluminum case. Also, The Galaxy S III by Samsung (SSNLF.PK) is released in the U.S. this month. Shares of Apple Inc. are trading 1.69% lower today.

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Facebook, Inc. (NASDAQ:FB): According to AllThingsD, Yahoo (NASDAQ:YHOO) and Facebook are beginning to settle their patent litigation which could lead to another close relationship between the two companies. Any deal between the two could result in a major cross-licensing of IP and deeper integration between the two sites, but Facebook is not ready to delve out a large amount of cash. Shares of Facebook, Inc. are trading 3.73% lower today.

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AT&T, Inc. (NYSE:T): Electronista reports, an antitrust lawsuit has been filed by C Spire, a privately-owned, regional wireless provider,against AT&T (NYSE:T). The lawsuit claims that the company used market influence to prohibit the smaller provider from usint its 700Mhz spectrum, and continues by claiming that (NASDAQ:GOOG) and Qualcomm (NASDAQ:QCOM) worked together to prevent regional carriers from having access to the newest devices. Shares of AT&T, Inc. are trading 0.68% higher today.

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MEDTOX Scientific, Inc. (NASDAQ:MTOX): LabCorp. (NYSE:LH) has agreed to acquire Medtox Scientific, a forensic and clinical laboratory, for $241M. The $27 per share offer represents a 37% premium over Medtox Scientific’s closing price of $19.70 on Friday. This acquisition comes as LabCorp. begins the expansion of its Toxicology Center of Excellence. Shares of MEDTOX Scientific, Inc. are trading 35.43% higher today.

Investing Insights: Will TV Be the Next Great Catalyst for Apple’s Stock?

Cleveland BioLabs, Inc. (NASDAQ:CBLI): According to Cleveland BioLabs, there are strong survival results for the company’s random, blind, placebo-controlled efficacy study of CBLB502 on 179 nonhuman primates, NHPs. This was conducted under Good Laboratory Practice with elements of Good Clinical Practice, which is a requirement of the U.S. FDA’s Animal Rule.  Accompanied with significant statistics, the study demonstrated a dose-response relationship between CBLB502 and the survival rate of lethally irradiated animals, which was the primary reason for the study. Shares of Cleveland BioLabs, Inc. are trading 57.48% higher today.

Gushan Environmental Energy Ltd (NYSE:GU): Gushan Environmental Energy (GU +50.5%), a manufacturer of copper goods and a producer of biodiesel in China, has agreed to become private for $162 per share under Chairman Jianqiu Yu and Trillion Energy Holdings. Though Q1’s revenue was estimated at $89.6M, the company reports a revenue of $42.3M for Q1. Shares of Gushan Environmental Energy Ltd are trading 46.15% higher today.

5 Sizzling Stocks Drawing Trader and Investor Attention

CREDO Petroleum Corporation (NASDAQ:CRED): Forestar (NYSE:FOR) has agreed to acquire Credo Petroleum for $24.50 per share, totaling $146M. The deal is expected to provide “meaningful” ownership and operation in various strategic oil and gas formations, which includes the Bakken and Three Forks. Shares of CREDO Petroleum Corporation are trading 31.77% higher today.

Auxilium Pharmaceuticals, Inc. (NASDAQ:AUXL): Following the announcement of positive top-line results in testing on the use of its Xiaflex drug as a treatment for Peyronie’s disease, the stock has moved up. Shares of Auxilium Pharmaceuticals, Inc. are trading 12.10% higher today.

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ImmunoGen, Inc. (NASDAQ:IMGN): After Roche (RHHBY) reported positive data for breast cancer treatment using Immunogen technology, Immunogen’s stocks rise. Roche reports that its T-DM1 reduced risks of disease progression or death in individual with a specific type of breast cancer by 35%. Immunogen states that T-DM1 is a drug combining Immunogen’s anti-cancer agent, DM1, and Roche’s antibody, transtuzumab. RBC Capital wrote that the trial’s results were “very impressive,” and expects these results to generate more interest among pharmaceutical investors and investors in Immunogen’s technology. On the other hand, the firm also mentions that Immogen is only slated to gain mid-single digit royalties from T-DM1. RBC reiterates its Outperform rating on Immunogen. Shares of ImmunoGen, Inc. are trading 1.15% higher today.

CONN’S, Inc. (NASDAQ:CONN): The company sees its FY SSS up mid  to high single digits as well as 5-7 new store openings. The company also sees retail gross margin between 32%-34%, and higher average selling prices in many, major product categories raised revenue. Retail segment gross margin has risen 320 bps to 33.7%, and the company sees same-store sales rising between mid and high single digits for FY13. This has increased EPS guidance to $1.30-$1.40. Shares of CONN’S, Inc. are trading 8.75% lower today.

AutoNation, Inc. (NYSE:AN): According to AutoNation, its retail new vehicle unit sales in May 2012 totaled 23,763, a 45% increase from last year. For May 2012, retail new vehicle unit sales were: 7,260 for Domestic, a 21% increase over the year, 12,300 for Import, a 78% increase over a year, and 4,203 for Premium Luxery, a 23% increase over a year. AutoNation is expected to report June 2012 retail new vehicle unit sales on July 5, 2012 and its Q2 earnings on July 19.Shares of AutoNation, Inc. are trading flat today.

Markets MIXED, Facebook Continues CRASH, Larry Ellison CHALLENGED

Markets closed mixed on Wall Street today: Dow -0.14%, S&P +0.01%, Nasdaq +0.46%, Oil +1.17%, Gold -0.14%.

On the commodities front, Oil (NYSE:USO) rose to $84.14 a barrel. Precious metals declined, with Gold (NYSE:GLD) falling to $1620 an ounce while Silver (NYSE:SLV) fell 0.29% to settle at $28.21.

Here’s your Cheat Sheet to today’s top stock stories:

A case that possibly marks the “end of a marriage” between tech giants Oracle (NASDAQ:ORCL) and Hewlett Packard (NYSE:HPQ) started its certainly acrimonious course today in the courtroom of Santa Clara Superior Court Judge James Kleinberg. The high-profile case, with HP seeking $4 billion in damages from Oracle, could be the media’s delight with personalities such as Larry Ellison, Mark Hurd and HP’s Ann Livermore taking the stand.

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Salesforce.com (NYSE:CRM) has beaten out other tech biggies for a deal that may be the newest signal that social media marketing is the next big buzz. The company announced on Monday that it had completed its acquisition of social media marketer Buddy Media in a nearly $700 million cash-and-shares deal.

Facebook (NASDAQ:FB) faced another rough day in the markets.  Its shares dropped 82 cents per share (almost 3%) to close at $26.90. Earlier in the day, Bernstein Research analyst Carlos Kirjner initiated coverage on the stock and gave it an “Underperform” rating, or the equivalent of sell with a $25 price target, reported MarketWatch. Kirjner wrote in his research note that Facebook is about to face several issues that could affect its revenue growth.

On Monday, an extraordinarily large number of external shareholders voted against the election of Wal-Mart’s (NYSE:WMT) top leadership through their more than 30% of votes against the company’s chairman, CEO and former CEO, according to a New York City Office of the Comptroller analysis. The negative vote comes after the New York Times reported that the company had supposedly authorized millions of dollars in Mexico bribes to speed up the receipt of building permits.

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