Stocks in the news: AA, SNE, C, MS, CSX, ELN, JPM, KMB, NWL, DE ...

Posted Jan 13th 2009 8:21AM by Melly Alazraki
Filed under: Earnings Reports, Analyst Reports, Analyst Upgrades and Downgrades, Deals, Citigroup Inc. (C), JPMorgan Chase (JPM), Sony Corp ADR (SNE), Adobe Systems (ADBE), Alcoa Inc (AA), Newell Rubbermaid (NWL), Morgan Stanley (MS), Kimberly-Clark (KMB), Palm Inc (PALM), Deere and Co (DE)

Alcoa Inc. (NYSE: AA), the first Dow component to report earnings and thus kick off the earnings season, posted a bigger-than-expected loss of $1.19 billion Monday after the close. This disappointing start to the earnings season came less than a week after the aluminum giant said it is cutting jobs and production. The causes are the general economic downturn, and specifically the lower demand from the automotive, commercial transportation and building and construction sectors, which caused a 35% slump in aluminum prices. AA shares traded 1% lower in premarket action, but that's after closing down nearly 7% Monday. AA shares decline over 3.5% around 10 am.

Sony Corp. (NYSE: SNE), the Japanese consumer electronics giant, will likely have an annual operating loss of about $1.1 billion, its first loss in 14 years, as sales fizzle for digital cameras, flat-panel TVs and other gadgets. Sony's shares plunged Tuesday and the stock fell more than 4.8% in pre-market trading. SNE shares declined over 3.3% near 10 am.

Citigroup, Inc. (NYSE: C) and Morgan Stanley (NYSE: MS) will no doubt still be in focus after news broke they are in negotiations for City to sell to Morgan Stanley a majority stake in its Smith Barney brokerage unit as a means of raising cash. Citi shares fell sharply Monday -- more than 17% -- as investors wonder how much more cash the troubled bank will need. Shares declined another 2% in premarket trading this morning. Citi shares decline over 5% and MS shares over 1.7% around 10 am.

CSX Corp. (NYSE: CSX), the railroad operator, warned on fourth-quarter profit, saying it expects earnings -- excluding one-time items -- to be about 90 cents a share. Revenue is projected to total $2.7 billion. This is below analysts forecasts of 99 cents earnings a share on revenue of $2.76 billion in the fourth quarter. CSX shares were up 1.3% around 10 am.

Elan Corp. (NYSE: ELN) shares jumped nearly 10% in premarket trading after the Irish drugmaker put itself on the block, hiring Citigroup as an adviser. ELN shares traded 3.7% higher around 10 am.

JP Morgan Chase & Co. (NYSE: JPM) has pushed up its fourth-quarter earnings release by six days to before the stock market opens on Thursday Jan 15 (from the previously scheduled Jan. 21). JP Morgan only said the bank is ready to report sooner. JPM shares traded 1.5% higher around 10 am.

Analyst calls:

Merrill Lynch is shifting its stance in the consumer products sector. As it is seeking more stable, less levered firms, it upgraded Alberto-Culver (NYSE: ACV) to Buy from Neutral and Kimberly-Clark (NYSE: KMB) to Buy from Underperform. It downgraded Energizer (NYSE: ENR) to Underperform from Buy and Newell Rubbermaid (NYSE: NWL) to Neutral from Buy. ACV and ENR both gained and lost 5% respectively by 10 am.
UBS upgraded Palm Inc. (NASDAQ: PALM) from Sell to Neutral.
Friedman Billings downgraded Adobe Systems (NASDAQ: ADBE) from Market Perform to Underperform.
JPMorgan downgraded Deere (NYSE: DE) from Overweight to Neutral.