Jim Cramer Blog

99 Cents Only Stores (NYSE:NDN - News) announced preliminary third-quarter results and the delay of the release of its third quarter Form 10-Q and the continued delay of its 2006 Form 10-K and Form 10-Qs for the first and second quarters of fiscal 2007. For the fiscal third quarter, net sales increased 8.3% to $302.1 million. Sales at stores open longer than a year rose 1.9%. The company said it expects to report net income of about 12 cents a share, compared to 10 cents a share in the year-ago period.

3M (NYSE:MMM - News) said it plans to buy back up to $7 billion of its own stock over the next two years, its biggest buyback program ever. Also, Soleil Securities upgraded the company to buy.
Alcoa (NYSE:AA - News) was in focus following a report in The Times of London that the Dow component may be a takeover target. The article mentioned BHP Billiton (NYSE:BHP - News) and Rio Tinto (NYSE:RTP - News) as the likely suitors.
Applebee's International Inc. (NasdaqGS:APPB - News) said its board formed an independent committee of directors to explore strategic options for the company, including a possible recapitalization or sale. Overland Park, Kan.-based Applebee's said there is no assurance that the process will result in any specific transaction. However, it said that certain strategic alternatives could affect its previously-issued guidance. As a result, the company withdrew its fiscal year 2007 forecast. The committee has hired Citigroup Global Markets and Banc of America Securities as financial advisors. Legal advisors are Cravath, Swaine & Moore of New York, and Blackwell Sanders Peper Martin of Kansas City.
Cephalon Inc. (NasdaqGS:CEPH - News) said it swung to a fourth-quarter net loss of $4.91 million, or 8 cents a share. In the same period last year, the biopharmaceutical company posted net earnings of $18.1 million, or 30 cents a share.
Ceridian Corp. (NYSE:CEN - News) said its fourth-quarter earnings rose 6.2% to $49.6 million, or 35 cents a share, from $46.7 million, or 32 cents, a year earlier, helped by its Comdata business, higher margins at Human Resources Solutions and a lower effective tax rate. The Minneapolis-based information-services company said revenue rose 6.5% to $404 million from $379.5 million in the year-ago period. Analysts polled by Thomson Financial expected, on average, fourth-quarter earnings of 33 cents a share on revenue of $409.5 million. The company expects 2007 earnings of $1.25 to $1.35 a share, excluding costs related to the election of directors, on revenue of $1.65 billion and $1.7 billion. The company also said it's retained Greenhill & Co. as its financial advisor as it explores strategic options.
Coca-Cola Enterprises (NYSE:CCE - News) said its fourth-quarter loss widened, due to a $2.92 billion impairment charge to reduce the book value of its North American franchise license intangibles, a $14 million restructuring charge and a $14 million legal settlement. The Atlanta drink marketer and distributor had a fourth-quarter loss of $1.71 billion, or $3.59 a share, compared with a loss of $57 million, or 12 cents a share, a year earlier. Excluding the impairment and restructuring charges and the legal settlement, the company earned 20 cents a share, compared with 14 cents a share a year earlier. Analysts surveyed by Thomson Financial expected, on average, earnings of 16 cents a share on revenue of $4.65 billion. Analyst earnings forecasts typically exclude unusual items. Coca-Cola Enterprises said it plans to cut 5% of its workforce, or about 3,500 jobs, as part of a restructuring of its North American and European operations. The restructuring will result in a $300 million charge, with the majority of the expense recognized in 2007 and 2008. In addition, the company said it expects 2007 earnings to be down 5% to 10% from 2006 results, due to higher prices for aluminum cans and high fructose corn syrup.
CVS Corp. (NYSE:CVS - News) increased the value of its offer for Caremark Rx Inc. (NYSE:CMX - News), saying Caremark shareholders will now receive a special cash dividend of $6 a share, up from the previously planned dividend of $2 a share. The dividend will be paid upon or shortly after completion. The other terms of the agreed deal remain unchanged. Under the terms Caremark shareholders will receive 1.67 shares of the merged company for each Caremark share they own. The increased dividend comes as Express Scripts is also attempting to acquire Caremark and after proxy firm Glass Lewis & Co. recommended Caremark shareholders reject the CVS deal.
Cynosure (NasdaqGM:CYNO - News) shares jumped after the Westford, Mass.-based maker of aesthetic treatment systems reported a fourth-quarter net profit of $1.53 million, or 13 cents a share, down from $2.53 million, or 29 cents a share, last year. Excluding certain items, Cynosure posted earnings of $2.51 million, or 21 cents a share, compared with $1.09 million, or 12 cents a share, last year. Revenue rose to $24.6 million from $16.1 million. Analysts polled by Thomson Financial were expecting a per-share profit of 16 cents on revenue of $20.9 million.
First Advantage Corp. (NasdaqGS:FADV - News) shares gained after the St. Petersburg, Fla.-based provider of risk mitigation services late Monday reported fourth-quarter net earnings of $18.2 million, or 31 cents a share, up from $16.2 million, or 29 cents a share, last year. Revenue rose to $206.1 million from $170.1 million. Analysts polled by Thomson Financial were expecting a per-share profit of 22 cents on revenue of $194.7 million
Forward Air Corp. (NasdaqGS:FWRD - News) said its fourth-quarter net earnings slipped to $12.17 million, or 40 cents a share, from $12.2 million, or 38 cents a share, in the same period last year, amid a "challenging freight environment."
General Motors (NYSE:GM - News) was upgraded to buy from sell at Merrill Lynch. The firm cited its increased belief that the automaker will use its liquidity and legacy assets, specifically in its pension, "to affect positive change." Analyst John Murphy is also establishing a $50 stock price target. The stock, a component of the Dow industrials, was last up 1.2% at $36.15 in pre-open trading. Murphy noted that GM's pension fund is over-funded by $17 billion, that pressure is mounting for change in the company's healthcare plan, and that the company's legacy assets are likely to be leveraged further. "The resulting sentiment is increasingly more optimistic and is trumping our previous expectation of pressure early in 2007," Murphy said in a research note. "Valuation is near bottom and illustrates the leverage."
Genesee & Wyoming (NYSE:GWR - News) posted a 32.5% rise in fourth quarter net income to $14.3 million, or 34 cents a share, from $10.8 million, or 26 cents a share, a year ago. Analysts were expecting the company to post earnings of 30 cents a share, according to data compiled by Thomson Financial. GWI said that its board has authorized the repurchase of up to 2 million shares of common stock. It's planning to continue an active acquisition program and is currently pursuing a number of international and domestic opportunities. Revenue rose 20% to $124 million in the quarter, primarily due to acquisitions.
Himax Technologies (NasdaqGS:HIMX - News) said its fourth-quarter earnings rose to $29.4 million, or 15 cents per American depository share, from $17 million, or 9 cents per ADS. The Tainan, Taiwan, maker of semiconductors said revenue rose 26% to $220.9 million from $177.3 million. The company expects first-quarter earnings of 8 cents to 9 cents a share and revenue to decline about 16% to 18%.
Icon (NasdaqGS:ICLR - News) said that its fourth-quarter net income rose to $11.4 million, or 39 cents a share, from $7 million, or 24 cents a share, a year ago. Analysts were expecting the company to post earnings per share of 36 cents, according to data compiled by Thomson Financial. Sales at the provider of services to the pharmaceutical, biotechnology and medical device markets rose 46% to $129 million, following strong growth at the company's clinical operations. The company said that, with a record backlog of $872 million, it's looking forward with confidence.
Illumina (NasdaqGM:ILMN - News) priced $350 million in convertible senior notes, to pay interest semiannually at a 0.625% annual rate, with can be exchanged for 22.9029 shares for each $1,000 principal amount held. That's equal to a conversion price of approximately $43.66 a share. It will buy back $202 million of shares in privately negotiated deals. In addition, approximately $41 million of the proceeds from the transactions will be used to fund the net cost of the convertible note hedge transactions and warrant transactions.
KB Home (NYSE:KBH - News) swung to a loss of $49.6 million, or 64 cents a share in the fourth quarter driven by previously announced land charges of $343.3 million. In a statement, Chief Executive Jeffrey Mezger said during the second half of 2006, "an oversupply of unsold new and resale homes, reduced affordability, and greater caution among potential homebuyers heightened competition among homebuilders and sellers of existing homes, prompting the aggressive use of price concessions and sales incentives." The result was pressure on profit margins, while results "were further affected by declining land values and the resulting charges we recorded in the fourth quarter to reflect lower land values," the CEO added.