MARKET PULSE- FedEx, BlackBerry, Tower Group, gold miners, Dragonwave
Sept 18 (Reuters) - Some U.S. stocks on the move on Wednesday:
WALL ST DRIFTS LOWER AS FED DECISION LOOMS
U.S. stocks rallied to a record high on Wednesday after the Federal Reserve surprised investors by saying it would not begin to cut its bond-buying program that has been a driving force behind Wall Street's climb of more than 20 percent this year. The Dow Jones industrial average rose 109.28 points or 0.7 percent, the S&P 500 gained 15.54 points 0.91 percent, and the Nasdaq Composite added 26.887 points or 0.72 percent.
** APPLE INC, $462.35, up 1.5 pct (12:38 p.m. ET)
The fingerprint reader on Apple's top-end iPhone 5S received an early thumbs up for ease of use from two influential reviewers, helping dispel concerns about the scanning technology which has been notoriously unreliable in other cellphones.
BLACKBERRY, $10.45, down 1 pct (2:25 p.m. ET)
The Canadian smartphone maker is preparing to make deep staff cuts by the end of the year via layoffs that could cost up to 40 percent of its employees their jobs, the Wall Street Journal cited people familiar with the matter as saying on Wednesday.
** ARUBA NETWORKS INC, $18.14, up 3.5 pct (2:34 p.m. ET)
Brokerage Piper Jaffray on Tuesday initiated coverage on the network-equipment maker's stock with an "overweight" rating, saying the company was well-positioned to gain share within the wireless local area netowrk (WLAN) market.
"Aruba's broad portfolio of both controller and controller-less technology, coupled with leading software solutions, will translate to further share gains in 2014," analyst Troy Jensen said in a note. He set a price target of $26 on the stock.
** VOLARIS, $13.92, up 16 pct (12:39 p.m. ET)
Shares of Mexico's low-cost airline Volaris rose in their U.S. debut on Wednesday after the company raised about $350 million through an initial public offering.
** REGENERON PHARMACEUTICALS INC, $306.00, up 3.2 pct (1:05 p.m. ET)
Goldman Sachs analysts raised the price target on the company's stock to $329 from $298, saying that investors are underappreciating the long-term growth potential of company's eye drug Eylea, particularly for the treatment of vision loss due to diabetes.
** CORONADO BIOSCIENCES INC, $7.90, down 4 pct (2:38 p.m. ET)
Roth Capital analyst Joseph Pantginis said that a Roth competitor issued a note on Tuesday expressing doubts on whether Coronado's experimental drug, TSO, will show a clinical benefit in treating Crohn's disease patients.
"We believe the primary risk revolves around the relatively small amount of clinical data across indications, but physician interest (in TSO) remains high in our belief," analyst Pantginis said in a note, countering the competitor's view.
** ELECTRONIC ARTS INC, $26.66, down 3.4 pct (1:18 p.m. ET)
Benchmark Co analyst Mike Hickey said the appointment of the video games publisher's sports and digital games division head Andrew Wilson as chief executive came as a slight disappointment to most investors who were looking for an external candidate for the position of the CEO.
** RR DONNELLEY & SONS CO, $16.04, down 3.3 pct (01:07 p.m. ET)
The printing services company's chief accounting officer Andrew Coxhead sold 15,000 shares for $249,300 on Monday, according to a regulatory filing on Tuesday.
The total implies a per-share price of $16.62, above Monday's closing price of $16.40.
** ENDEAVOUR SILVER CORP, $5.03, up 16.7 pct (03:54 p.m. ET)
** AURICO GOLD INC, $4.41, up 15 pct
** HARMONY GOLD MINING, $4.14, up 14.7 pct
** FIRST MAJESTIC SILVER CORP, $14.1, up 11.5 pct
** ROYAL GOLD, $57.14, up 10.5 pct
** BARRICK GOLD, $20.17, up 10 pct
** HECLA MINING CO, $3.54, up 9.5 pct
** ANGLOGOLD ASHANTI LTD, $14.16, up 7.8 pct
Gold soared around 3 percent after the U.S. Federal Reserve said it would continue buying bonds at an $85 billion monthly pace for now, surprising financial markets that were braced for a reduction in the central bank's economic stimulus. Spot gold was up 2.9 percent to $1,446.74 an ounce by 2:18 p.m. EDT (1818 GMT). Silver rose 3.5 percent to $22.43 an ounce.
** AK STEEL HOLDING CORP, $4.30, up 5 pct (1:59 p.m. ET)
Shares of the steelmaker rose after it filed antidumping duty petitions with regulators, saying that unfairly traded imports of grain-oriented electrical steel (GOES) from seven countries were hurting the U.S. steel industry.
Jefferies & Co analyst Luke Folta said the company was hoping for duties to be imposed on such imports, which could push up domestic steel prices.
** GT ADVANCED TECHNOLOGIES INC, $7.48, up 8.6 pct (14:12 p.m. ET)
** RUBICON TECHNOLOGY INC, $12.70, up 12.4 pct (2:31 p.m. ET)
Analysts said the companies, which provide equipment for makers of sapphire-based components, are expected to benefit from Apple's plan to extend the use of sapphire glass home keys to its new 9.7-inch iPad and 7.9-inch iPad mini to be launched in October.
Apple could further adopt sapphire for making touch screen covers for its new iPhone to be launched in 2014, according to Taiwan-based sapphire makers, Digitimes reported. (link.reuters.com/feb33v)
However Raymond James Euro Equities analyst Pavel Molchanov said that GT would not be a direct beneficiary of Apple's plans as it only provides manufacturing equipment to its customers. GT would benefit only if its customers plan to expand capacity as a result of higher orders from Apple.
** WI-LAN INC, $4.08, up 13 pct (12:18 p.m. ET)
The Canadian patent licensing company granted licenses to HTC Corp to use its patents for mobile handsets and tablets sold in the United States.
Wi-Lan also said all five pending litigations with HTC will be resolved as a part of the agreement.
** SEARS HOLDINGS CORP, $59.60, down 4 pct (12:28 p.m. ET)
The retailer set price guidance on its new $1 billion term loan earmarked to pay down revolver borrowings at the company, sources told Thompson Reuters LPC. The new first-lien term loan is guided at LIB+450-475 basis points, with a 1 percent Libor floor and a 99 original issue discount.
** EXPRESS SCRIPTS HOLDING CO, $63.50, down 4 pct (12:59 p.m. ET)
** CATAMARAN CORP, $52.90, down 4 pct (12:59 p.m. ET)
Shares of the pharmacy benefits managers fell after the largest U.S. drugstore, Walgreen Co, moved 120,000 employees to a private health insurace exchange where they can choose a plan from multiple insurers.
Express Scripts and Catamaran, which are in the business of managing pharmacy benefits for large employers, administer drug benefits and health plans for employers.
** NEW RESIDENTIAL INVESTMENT CORP, $6.70, up 4.8 pct (12:29 p.m ET)
The real estate investment trust declared a third-quarter dividend of 17.5 cents per share. This is the company's first dividend since spinning off from Newcastle Investment Corp in the second quarter.
** NOKIA, $6.58, up 5 pct (12:39 p.m. ET)
Brokerage Credit Suisse upgraded the Finnish mobile phone maker's Helsinki-listed shares to "outperform" from "neutral", saying its transformative deal with Microsoft Corp allows it to drive significant value creation from its vast patent portfolio.
** BENEFITFOCUS INC, $48.57, up 83 pct (12:40 p.m. ET)
The software maker's shares rose as much as 62 percent in their debut as investors continued to show confidence in cloud-based service providers. The company, backed by Goldman Sachs Group Inc and private equity firm Oak Investment Partners LP, priced its initial public offering at $26.50 per share.
** DRAGONWAVE INC, $2.06, down 16.5 pct (12:40 p.m. ET)
The telecom network equipment maker priced its public offering at $2.10 per unit, a 14 percent discount to its Tuesday's closing price on the Nasdaq.
DragonWave said it intends to use net proceeds from the $25 million offering for funding working capital and general corporate purposes.
** TOWER GROUP INTERNATIONAL LTD, $10.19, down 26 pct (12:43 p.m. ET)
FBR cut its rating on the property and casualty insurer's stock to "market perform" from "outperform" after the company further delayed its second-quarter results announcement till the first week of October. FBR said that higher reserves in the second quarter could put the insurer in a weaker capital position.
** 8X8 INC, $10.40, up 6.8 pct (12:43 p.m. ET)
The internet telephone company appointed Ian Potter to its board, effective Sept 17. [ID: nBw5P3WNja]
Potter previously served as Managing Director at Morgan Stanley & Co in Singapore from 1994. Potter is "very strategic", William Blair & Co analyst Dmitry Netis said, adding that his banking experience makes him well positioned to take the company forward. Netis also said the planned IPO by the company's rival RingCentral has also been driving 8X8's shares up.
** COGNIZANT TECHNOLOGY SOLUTIONS CORP, $82.82, up 2 pct (12:44 p.m. ET)
Brokerage Barclays Capital upgraded the IT services provider's stock to "overweight" from "equal weight" as it sees growth in the company's business in consulting and outsourcing in Europe. It also expects strong growth in its health care business. Barclays raised its price target on the company's stock to $97 from $80. Brokerage Evercore Partners also raised its price target late on Tuesday.
** LINN ENERGY LLC, $27.03, down 3 pct (12:45 p.m. ET)
In a filing with the U.S. Securities and Exchange Commission, the oil and gas producer made changes to the way it defines and calculates cash flow. Raymond James analyst Kevin Smith said the rewiring does not change Linn's underlying cash flow.
"Meaning there is a lot of heartache going on but no change in the company's ability to pay its distribution or how much cash flow Linn actually generates," he said. (r.reuters.com/nyz23v)
The SEC is investigating Linn's accounting and its offer to buy Berry Petroleum Co.
** NRG ENERGY INC, $27.28, down 2.3 pct (12.45 p.m. ET)
Brokerage Goldman Sachs downgraded the U.S. power company to "neutral" from "conviction buy" on expectations that the company's earnings in 2015 would be below estimates due to a fall in power prices.
** ATOSSA GENETICS INC, $6.45, up 30 pct (12:46 p.m. ET)
The medical device maker said it had entered into a distribution agreement with a unit of McKesson Corp to sell the company's device used to collect breast fluid.
** CAESARS ENTERTAINMENT CORP, $22.30, down 14 pct (12:46 p.m. ET)
The casino operator said it has begun a refinancing process for its outstanding mortgage loans under the second amended and restated loan agreement.
RBC Capital Markets analyst John Kempf said the share movement is a sell-off on the news as the stock was running up in anticipation of the announcement.
** FEDEX CORP, $113.84, up 2.8 pct (12:47 p.m. ET)
FedEx posted a bigger quarterly profit as the courier company cut costs and its lower-priced ground shipping business did well.
** KINDER MORGAN INC, $35.67, up 2.7 pct (12:47 p.m. ET)
The oil and gas pipeline and processing company detailed their capital spending for the El Paso project at an investor conference on Wednesday after a research note on Sept 4 spooked investors and shaved $4 billion off its market value.
Kevin Kaiser, an analyst at Hedgeye Risk Management, shot an an email to his clients which said Kinder Morgan and its associated companies "is a house of cards, completely misunderstood and mispriced".
"I would suggest that investors should prefer to rely on expertise rather than the opinion of one analyst looking at a number of financial reports," said Chief Executive Richard Kinder on the call.
** ADOBE SYSTEMS INC, $51.64, up 7.3 pct (12:47 p.m. ET)
The company, known for its Photoshop and Acrobat software, expects subscriber growth to top the 331,000 it added in the third quarter due to strong demand from corporate customers.
** HEAT BIOLOGICS INC, $13.09, up 7.4 pct (12:49 p.m. ET)
Aegis Capital Corp began coverage of the biotechnology company with a "buy" rating, saying preliminary data of its bladder and lung cancer study could be out later in the year and positive outcomes could make it a prime acquisition candidate.
The company's Heat Biologics platform, called Immune Pan Antigen Cytotoxic Therapy, delivers modified human cells into the body to activate a cancer patient's immune system and kill cancerous cells.
** COMBIMATRIX CORP, $2.79, down 6 pct (12:48 p.m. ET)
The molecular diagnostics company said on Tuesday it would offer $10 million of Class A and Class B units.
** AVG TECHNOLOGIES NV, $24.98, up 2.2 pct (12:48 p.m. ET)
Brokerage Nomura Equity Research initiated coverage on the PC and mobile anti-virus software maker's stock with a "buy" rating and a $29 price target, citing the "optimistic view" on the company's ability to monetize its mobile installed base in 2014 and its continued diversification of platform search business.
** FRANK'S INTERNATIONAL NV, $29.00, up 3.2 pct (12:49 p.m. ET)
Brokerage Barclays Capital started its coverage of the oil services company with an "overweight" rating and target price of $35, citing the benefits from the surging deepwater drilling activity, a strong balance sheet and high margins.
** TRIUMPH GROUP INC, $70.96, down 9.7 pct (12.50 p.m. ET)
The maker of aircraft components said it expects to record pretax additional program costs of $68 million, or 83 cents per share, associated with the 747-8 program. The company expects a charge of about $44 million, or 53 cents per share, to be included in the second-quarter results, while $11.0 million, or 14 cents per share, would be reflected in the third-quarter earnings.
** SANGAMO BIOSCIENCES INC, $11.01, up 4 pct (12:50 p.m. ET)
The drugmaker said its common stock offering of 6.1 million shares is priced at $10.58 per share, the closing price of its stock on Tuesday, and which will fetch $65 million in gross proceeds.
** VISHOP HOLDINGS LTD, $53.60, up 9.4 pct (12:51 p.m E.T)
Deutsche Bank upgraded its rating on the Chinese online discount retailer's stock to "buy" from "hold," according to theflyonthewall.com
** REPOROS THERAPEUTICS INC, $25.70, up 7.8 pct (12:51 p.m. ET)
Ladenburg Thalmann raised the price target of the drugmaker's stock to $35 from $25 and reiterated a "buy" rating after the company's experimental drug Androxal met the main goals of a key study on men with low testosterone levels.
** CRACKER BARREL OLD COUNTRY STORE INC, $102.50, down 4 pct (12:51 p.m. ET)
The restaurant operator forecast current-quarter profit below analysts' estimates due to higher commodity costs and other expenses.
** SERVICENOW INC, $51.16, up 3.7 pct (12:52 p.m. ET)
Brokerage Morgan Stanley upgraded the cloud computing company's stock to "overweight" from "equal weight", according to theflyonthewall.com.
** ALLIANCE FIBER OPTIC PRODUCTS INC, $22.34, up 10.4 pct (12:52 p.m. ET)
The supplier of fiber optic components raised its revenue expectations for the current quarter due to a recovery in spending by telecom equipment makers.
Brokerage B. Riley on Wednesday raised its price target on the company's stock to $19 from $15.60.
** EAGLE BULK SHIPPING INC, $5.52, up 9 pct (12:53 p.m. ET)
** DRYSHIPS INC, $3.22, up 4.3 pct
The Baltic Exchange's main sea freight index, which reflects the cost of shipping commodities such as iron ore, cement, grain, coal and fertiliser, was up about 5 percent for the second consecutive day.
In recent weeks, rates for capesize ships, one of the largest dry bulk vessels hauling industrial commodities like coal and iron ore, have spiked to their highest levels since December 2011, reaching more than $32,000 a day, helped by an iron ore import push by China.
** SOHU.COM INC, $74.30, up 9.6 pct (12:53 p.m. ET)
The Chinese internet portal on Wednesday said its majority-owned search unit Sogou Inc paid a special dividend amounting to $300.9 million to the holders of Series A preferred shares of Sogou.
** MAXWELL TECHNOLOGIES, $9.63, up 3 pct (12:54 p.m. ET)
Piper Jaffray raised its rating on the stock of the maker of energy storage and power delivery-related products to "overweight" from "neutral", according to theflyonthewall.com.
** FLEETMATICS GROUP PLC, $45.17, down 6 pct (12:54 p.m. ET)
The company, which sells web-based fleet-tracking software, announced the pricing of about 6 million of its ordinary shares at a price of $46.79 per share in a follow-on offering.
** CHEMOCENTRYX INC, $6.13, down 4.5 pct (12:55 p.m. ET)
Chemocentryx said that GlaxoSmithKline Plc returned the rights to its most advanced drug in development for inflammatory bowel disease.
** RESPONSYS INC, $15.98, up 7.2 pct (12:55 p.m. ET)
Morgan Stanley raised its rating to "overweight" from "equal weight" on the marketing software and online services provider's stock, according to the website theflyonthewall.com.
** BIOTA PHARMACEUTICALS INC, $4.15, down 5.3 pct (12:56 p.m. ET)
The drugmaker said it had received no royalty for its flu drug Relenza from GlaxoSmithKline in the fourth quarter due to tepid demand for the drug.
The company expects to earn an equal or lesser amount from the drug in royalty revenue in 2014 compared to 2013.
** DOLLAR TREE INC, $57.01, up 2.1 pct (12:56 p.m. ET)
The value retailer on Tuesday announced a $2 billion share repurchase program. The company also said it had entered into agreements to repurchase $1 billion of its common shares under a variable maturity accelerated share repurchase program.
** FIVE BELOW INC, $45.60, down 6 pct (12:56 p.m. ET)
The specialty value retailer on Tuesday announced a secondary offering by its shareholders. The company said shareholders have agreed to sell 7.1 million shares of its common stock, of which 7 million shares would be sold by funds affiliated with Advent International and 100,000 shares will be sold by Five Below's executive chairman. (Compiled by Varun Aggarwal)
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