US HOT STOCKS: FTI Consulting, State Street, Family Dollar

7th Jul 2010 18:20

U.S. stocks traded higher Wednesday. The Dow Jones Industrial Average rose 1.9% to 9925, the Standard & Poor's 500 climbed 2% to 1049 and the Nasdaq Composite gained 1.7% to 2129. Among the companies whose shares are actively trading in the session are FTI Consulting Inc. (FCN), State Street Corp. (STT) and Family Dollar Stores Inc. (FDO). Business-advisory firm FTI Consulting ($32.53, -$10.74, -24.82%) predicted a surprise decline in second-quarter earnings and cut its full-year guidance. Explaining the pessimistic outlook, Chief Executive Jack Dunn said that while its economic consulting, strategic communications and forensic and litigation consulting segments its "procyclical" practices were all growing, progress wasn't up to pace with what the company had originally anticipated. Shares of State Street ($36.40, +$3.06, +9.18%) rose Wednesday after the bank said it will report a second-quarter profit well above analysts' forecasts, putting the company on track to hit its full-year guidance. Fellow trust banks Northern Trust Corp. (NTRS, $48.19, +$2.23, +4.85%) and Bank of New York Mellon Corp. (BK, $26.04, +$1.30, +5.25%) also traded higher, as they are seen as similarly exposed to foreign currency fluctuations that, Janney Capital Markets analyst Thomas McCrohan said, helped boost State Street's revenue in the second quarter. Family Dollar Stores' ($36.11, -$3.33, -8.44%) fiscal third-quarter earnings increased 19% as the discount retailer continued to report higher sales and margins. The company said the strength continued into June, with the month's same-store sales up 5.5%. As such, it predicted growth of 5% to 7% for the fourth quarter. But shares fell as it projected a profit below analysts' expectations as it anticipates continued caution by shoppers. Fellow discounters Dollar General Corp. (DG, $27.25, -$0.75, -2.68%) and Dollar Tree Inc. (DLTR, $41.69, -$1.24, -2.89%) also traded lower. Affymetrix Inc. (AFFX, $4.24, -$1.31, -23.60%) cut its revenue view for the second quarter, saying equipment purchase cycles from some of its customers are delayed and lengthened. The maker of assays and systems to analyze genetic information said it now expects revenue to range from $71 million to $72 million, down from its previous guidance of $80 million to $82 million, which was lower than analysts' forecasts at the time it was given. Skilled Healthcare Inc. (SKH, $1.52, -$4.70, -75.56%) faces payments of more than $671 million in damages awarded by a California jury in a more than four-year-old lawsuit over alleged violations at 22 of its nursing facilities. The jury said the company violated the California health and safety code that mandates that nursing homes maintain 3.2 nursing hours per patient per day. The Skilled Healthcare verdict weighed on fellow nursing-home company Sun Healthcare Group Inc. (SUNH, $7.33, -$0.45, -5.78%), which also has exposure to California. But Leerink Swann defended Sun Healthcare, saying the company hasn't been sued for the same issue. "We believe the company faces minimal risk if its California staffing levels are investigated," Leerink wrote. BP Plc (BP, $32.76, +$0.85, +2.66%) Chief Executive Tony Hayward met with Abu Dhabi's powerful Crown Prince Mohammed bin Zayed Al Nahyan during a visit to the oil-rich sheikdom Wednesday, and said that he would be happy to see the city-state's sovereign wealth fund buy a stake of up to 10% in BP, a person with knowledge of the meeting told Zawya Dow Jones. Other Stocks In Focus: AES Corp. (AES, $9.65, +$0.75, +8.43%) said its board approved a $500-million stock buyback program, the latest to do so in the improved credit and earnings environment. The power producer's shares outstanding have a total market value of about $7 billion, according to Tuesday's closing price. Allegiant Travel Co. (ALGT, $43.50, +$0.94, +2.21%) carried passengers greater distances on fuller planes in June as a key revenue metric improved for the airline. Borders Group Inc. (BGP, $1.23, +$0.06, +5.13%), the nation's second largest bookstore chain by sales, has launched an e-bookstore powered by Kobo, Inc., the Canadian e-book retailer in which Borders owns an investment stake. Howard Weil raised its stock-investment rating on exploration and production company Brigham Exploration Co. (BEXP, $15.52, +$0.65, +4.37%) to market outperform from market perform, citing a recent pullback in the stock. Health-insurance giant UnitedHealth Group Inc. (UNH, $29.00, +$0.11, +0.36%) has decided against covering CardioNet Inc.'s (BEAT, $4.21, -$0.56, -11.74%) outpatient cardiovascular telemetry, calling it "unproven for managing cardiac arrhythmias." The company, which makes systems that monitor heart-rhythm disorders for people on an outpatient basis, said Wednesday it is currently analyzing the potential impact of the coverage decision on its operations and will address it later this month when it discusses second-quarter results. Sidoti & Co. upgraded Carpenter Technology Corp. (CRS, $33.76, +$1.76, +5.50%) to buy from neutral, noting a 19% decline in the maker of specialty metals' share price since a June 15 high. The firm said shipments to aerospace engine customers improved sequentially in the first three quarters of fiscal 2010 and it expects aerospace sales will increase 20% in fiscal 2011. Central European Distribution Corp. (CEDC, $24.79, +$2.30, +10.23%) said it has decided not to pursue an acquisition of Ukrainian vodka company Nemiroff. The alcohol importer and seller said net proceeds expected from the sale of its Polish distribution business, initially targeted for the acquisition, are expected to be used instead to maximize return on capital, increase earnings and/or reduce debt. (MORE TO FOLLOW) Dow Jones Newswires July 07, 2010 13:20 ET (17:20 GMT)