U.S. stocks were trading lower Monday, as the Dow Jones
Industrial Average lost 113 points to 13898, the Standard &
Poor's 500 Index fell 13 points to 1500, and the Nasdaq Composite
shed 36 points to 3143. Among the companies with shares trading
actively in Monday's session are Acme Packet Inc. (APKT) and MWI
Veterinary Supply Inc. (MWIV).
Oracle Corp. (ORCL) agreed to buy Acme Packet Inc. for roughly
$1.98 billion in cash, a deal the technology heavyweight said will
accelerate the deployment of all-IP networks. Oracle will pay
Acme's shareholders a per-share cash price of $29.25, a premium of
22% over Friday's close. Word of the deal lit a fire under
networking names, namely fellow-broadband equipment maker Sonus
Networks Inc. (SONS), BroadSoft Inc. (BSFT) and Procera Networks
Inc. (PKT). Acme shares climbed 22% to $29.20, while Oracle was off
2.6% to $35.28.
MWI Veterinary Supply Inc.'s sizeable fiscal first-quarter
beat-and-raise, coupled with cash flow more than doubling, shows
why the company's stock has been an investor favorite, surging
nearly six-fold the past four years. A strong IPO Friday for Pfizer
Inc.'s (PFE) animal-health business Zoetis Inc. (ZTS) further
highlights the big money and investor optimism for the space.
Shares jumped 7.1% to $123.72.
Other Stocks to Watch:
Brown & Brown Inc.'s (BRO) fourth-quarter earnings rose 17%
as the insurance agency and brokerage firm continued to report
top-line growth from commissions and fees. Results beat Wall Street
expectations, sending shares up 6.1% to $29.16.
Cabela's Inc. (CAB) falls 3.6% to $48.65 after being downgraded
to hold from buy by Feltl & Co. primarily on valuation. The
firm is also concerned about credit-card-interchange income that
last week came in significantly lower than expectations, a
shortcoming noted by other investment firms. Interchange fees are
paid by merchants to card issuers when a consumer swipes a card.
Feltl feels the credit card-business is healthy with low
charge-offs and delinquencies and rising receivables, but
lower-than-expected interchange income "leads us to be more
hesitant in our rating until we have more visibility into future
trends."
Clorox Co.'s (CLX) fiscal second-quarter earnings rose 17% as
price increases pushed the consumer-products company's sales and
margins higher. The company also raised its targets for the year,
sending shares up 1.3% to $80.16.
Comfort Systems USA Inc.'s (FIX) 20% run over the last three
months led BB&T to cut its rating to hold from buy, noting the
valuation feels "full" and its sees tough times in the near future
for the HVAC installation and maintenance provider. "While we
continue to believe that nonresidential construction spending could
recover more fully late this year or early next, we doubt that
Comfort's [first half] outlook has improved since November," the
firm said. Shares sink 6.9% to $12.12.
Cyberonics Inc. (CYBX) said a former employee voluntarily
dismissed without prejudice a lawsuit he filed against the
medical-device maker in a Massachusetts federal court. The lawsuit
had raised "the potential for this case broadening to something
larger" like a qui tam, or "whistleblower" suit, Jefferies analyst
Raj Denhoy said in a note to clients. Shares of the medical-device
maker recently rose 6.8% to $47.37.
Gannett (GCI) shares started 2013 with a 10% jump after a
second-half surge, so perhaps it should be no surprise that there's
some sell-on-the-news activity after the media company's modest 4Q
beat. "Results were slightly better [than expected], but no
blowout," Evercore's Doug Arthur tells Dow Jones. Meanwhile,
print-ad demand remains in the doldrums, with that revenue down
6.5% once an extra week of activity is stripped out. Still, that
decline was GCI's least of 2012, showing how the company has yet to
see the bottom on that front after not seeing any print-ad growth
since 2006. Shares are down 5.4% at $18.77 while soon-to-report New
York Times (NYT)--cut to sell by Lazard--falls 3.8% to $8.53.
Harris Teeter Supermarkets Inc.'s (HTSI) shares continues to
slide after the supermarket chain reported fiscal first-quarter
earnings below analysts' estimates as the supermarket chain
responded to "aggressive pricing by competitors as well as low
inflation and sluggish holiday sales (particularly Thanksgiving),"
said BB&T in a Friday note to clients, as it cut its rating to
hold. Shares fell 3.9% to $36.19.
Humana Inc. (HUM) kept an upbeat outlook for 2014 at its
investor day Monday, as 2014 will be an important year for health
insurers as major changes under the health-care law click into
place. Shares rose 4.6% to $78.79.
Mercury General Corp. (MCY) swung to a surprise fourth-quarter
loss as the insurance company recorded lower revenue driven by
investment losses, while its catastrophe losses nearly tripled due
to Hurricane Sandy. Results missed Wall Street estimates, sending
shares down 5.8% to $38.01.
Royal Caribbean Cruises Ltd. (RCL) swung to a fourth-quarter
loss as the cruise-ship company recorded a massive impairment
charge, although net yields--a key industry metric measuring
revenue per available cruise day--beat expectations. For the year
ahead, the company projected earnings well below Wall Street
forecasts. Shares fell 4.1% to $35.29.
After jumping more than 15% since late-December, Tiffany &
Co. (TIF) retreats 3.7% to $62.37 Monday after Monness Crespi Hardt
cuts the jeweler to neutral, due to the rally and an "uncertain
retail environment." The investment bank expects shares to be at
current levels later this year.
Ultratech Inc. (UTEK) falls 3.1% to $40.09, following a Friday
note by D.A. Davidson, downgrading the company to underperform.
Davidson says "based on the revised 2013 outlook for 5%-10% EPS
growth, combined with rising competition in the back end advanced
packaging market, we believe UTEK no longer deserves a significant
valuation premium over its peer group." The firm notes that it
believes per-share earnings growth will be limited based on a
combination of reduced advanced packaging sales--the company's
highest margin produce line--and increased spending to try to seed
the market with new products.
Yahoo Inc.'s (YHOO) biggest shareholder has sold 11 million
shares, as it seeks to maintain a consistent percentage holding in
the Internet firm amid Yahoo's aggressive stock buyback program.
Shares fall 2.1% to $19.35.
Write to Saabira Chaudhuri at saabira.chaudhuri@dowjones.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires