US HOT STOCKS: IBM, Texas Instruments Active In Late Trading

19th Jul 2010 22:08

U.S. stocks closed higher Monday as the Dow Jones Industrial Average rose 57 points to 10154, the S&P 500 gained 6 points to 1071 and the Nasdaq Composite moved up 19 points to 2198. Among the companies whose shares are actively trading in the after-hours session are International Business Machines Corp. (IBM), Texas Instruments Inc. (TXN) and Zions Bancorp (ZION) IBM's second-quarter profit climbed 9.1% as the tech giant benefited from higher software and services revenue and noted strong demand in growth markets. The company also said it expects earnings this year to rise to "at least" $11.25 a share, its second increase to the projection. Wall Street seemed to expect a slightly higher increase, most recently projecting an average of $11.27. IBM's stock slid 3.9% to $124.72 in after-hours trading as revenue growth wasn't as strong as expected. Texas Instruments' second-quarter profit rose sharply--and its quarterly operating profit set a record--on a strong rebound in demand for electronic devices as the company increased its manufacturing capacity. But shares fell 6% to $24.01 in recent after-hours trading as the world's largest analog-chip maker's results were merely in line with its raised guidance. Zions' second-quarter loss widened more than expected amid a prior-year gain as the Utah-based regional bank reported its seventh straight quarter in the red. Shares were down 3.1% at $20.75 after hours. Atheros Communications Inc. (ATHR), a chip maker for wireless products, has agreed to pay at least $72 million for China's Opulan Technologies Corp., a closely held, fabless chip maker focusing on optical networking and broadband access. Shares of Atheros, which shipped its 500 millionth Wi-Fi chip during the second quarter, were down 9.6% to $27.60 after hours. Regular-Session Movers Halliburton Co.'s (HAL, $29.17, +$1.66, +6.03%) second-quarter earnings rose 83% as the oilfield-services company reported stronger revenue and sequential growth across all its markets. Results rebounded from a weak prior-year period and beat analysts' expectations. Rival services companies were also getting pumped up by the report, including Baker Hughes Inc. (BHI, $47.70, +$1.70, +3.70%) and Smith International Inc. (SII, $40.92, +$1.77, +4.52%). PetMed Express Inc.'s (PETS, $16.66, -$0.96, -5.45%) fiscal first-quarter results unexpectedly fell, with the pet pharmacy blaming an inability to buy television advertising at low-enough prices and reduced customer usage of products bought. ATC Technology Corp. (ATAC, $24.20, +$6.77, +38.84%), which provides logistics and refurbishment services to the consumer-electronics industries and the vehicle-service parts markets, has said it agreed to be acquired by closely held GENCO Distribution System Inc. for $512.6 million, but it has a month to solicit other bids. U.K. engineering and manufacturing company Tomkins PLC (TKS, $17.67, +$3.80, +27.40%) said it has received a 325 pence a share, or GBP2.86 billion ($4.36 billion), cash bid approach from Canadian private equity firm Onex Corp. and the Canada Pension Plan Investment Board. After considering the proposal terms, the company said, it has allowed the bidders to carry out due diligence which is now at an advanced stage. Hedge-fund operator Ramius LLC made public a proposal to acquire 90% of Cypress Bioscience Inc. (CYPB, $3.35, +$0.85, +34.00%) at a 60% premium to Friday's closing price, valuing the biotechnology company at about $150 million. Shares of for-profit education companies were surging Monday. Baird said stocks in the sector are likely moving on short-covering ahead of a draft proposal on gainful employment, which has been watered down, according to firm's sources. While that's positive for all higher-ed companies, "we believe some companies could remain at risk of violating the proposal," Baird said. The firm added it has heard the Department of Education will brief leading Congressional Democrats on the education committees later this afternoon or Tuesday morning. Top gainers include Education Management Corp. (EDMC, $18.49, +$2.73, +17.32%), Bridgepoint Education Inc. (BPI, $17.31, +$1.61, +10.25%) Capella Education Co. (CPLA, $88.90, +$8.30, +10.30%) and Corinthian Colleges Inc. (COCO, $10.40, +$0.87, +9.13%). BP PLC (BP, $35.75, -$1.35, -3.64%) said tests on a well cap that has halted the flow of oil into the Gulf of Mexico for several days continue to produce expected results, but the company's shares dropped after U.S. authorities raised concerns that hydrocarbons may be leaking from the sea bed near the Macondo well. Meanwhile, some of the other names tied to the disaster were also in the red again, despite an overall strong performance from the energy sector. Anadarko Petroleum Corp. (APC, $45.52, -$1.94, -4.09%) and Transocean Ltd. (RIG, $48.08, -$4.00, -7.68%) were both sliding. Rattled by economic conditions and the expiration of a government subsidy for home buyers, U.S. builder confidence in July sank to its lowest level in more than a year, casting doubt on the housing sector's recovery. The bigger-than-expected drop marked the second decline in a row, caused by the end of a government tax credit for home buyers and high unemployment. Shares of builders slid on the report, with Hovnanian Enterprises Inc. (HOV, $3.84, -$0.19, -4.71%), M/I Homes Inc. (MHO, $9.23, -$0.44, -4.55%) and Beazer Homes USA Inc. (BZH, $3.59, -$0.11, -2.97%) among the weakest. Meanwhile the forest-products companies that supply builders were also weak, including Louisiana-Pacific Corp. (LPX, $6.71, -$0.28, -4.01%) and Universal Forest Products Inc. (UFPI, $29.72, -$0.87, -2.84%). Home health-care stocks slid after Medicare's late Friday release of proposed 2011 rates and rules for providers, including average cuts of 4.75%. The group was already pressured by Security and Exchange Commission investigations into Medicare billing practices. Proposed 2011 Medicare rules mandate face-to-face patient-physician encounters to confirm eligibility, which could hit Amedisys Inc. (AMED, $25.06, -$0.96, -3.69%), CRT Capital Group says. Jefferies says investors likely surprised by an additional proposed 2012 cut for so-called case-mix creep. LHC Group (LHCG, $20.99, -$1.05, -4.76%), Gentiva Health Services Inc. (GTIV, $21.10, -$1.19, -5.34%) and Almost Family Inc. (AFAM, $24.02, -$1.58, -6.17%) also declined. Amgen Inc. (AMGN, $53.60, +$1.43, +2.73%) said the Food and Drug Administration agreed to a priority review for denosumab, a drug to prevent skeletal problems in cancer patients. The FDA is scheduled to decide whether to approve the drug by Nov. 18. Shares continued to slip for Apple Inc. (AAPL, $245.58, -$4.32, -1.73%) as it battles public-relations trouble with its newest iPhone launch, with competitors rejecting claims the technology giant made Friday that reception problems were common for all smartphones. Research in Motion Ltd. (RIMM, $54.27, +$1.76, +3.35%) and Motorola Inc. (MOT, $7.92, +$0.42, +5.60%), said they have deliberately avoided Apple's approach of locating antennas on the phone's edge, which some have called a mistake. And Asian handset makers HTC Corp. (HTCXF, $19.51, +$0.00, +0.00%) and Samsung Electronics Co. (005930.SE) cast the latest rebukes. Taiwan's HTC said Apple should address the problem on its own rather than blame its competitors. Analysts at Goldman Sachs removed Bank of America Corp. (BAC, $13.61, -$0.37, -2.65%) from their conviction buy list but maintained a buy rating on the bank Monday. Analyst Richard Ramsden said that Bank of America, which reported earnings last week, showed the least amount of credit improvement when compared with J.P. Morgan Chase & Co. (JPM, $39.04, +$0.04, +0.10%) and Citigroup Inc. (C, $3.98, +$0.08, +2.05%). Reiterating a conviction buy rating for J.P. Morgan, Ramsden said J.P. Morgan saw the most rapid credit improvement this quarter and has higher flexibility due to attractive capital ratios. At the Farnborough International Airshow, aircraft maker Boeing Co. (BA, $63.18, +$1.28, +2.07%) said the market for commercial aircraft is coming back as it announced an order for 30 of its 777 jets. (MORE TO FOLLOW) Dow Jones Newswires July 19, 2010 17:08 ET (21:08 GMT)