Morning News Roundup

Morning News of Note:

• Gapping Up
  Gapping up on strong earnings/guidance: VC +8%, IACI +7.6%, UTHR +6.2%, ENZN +5.5%, PKD +4.7%, VSH +4.1%, SIRI +3.3%, ADM +2.7% (up in sympathy: PEIX +2.5%), MRO +2%, MRO +1.5%, COH +1.4%... Other News: SCT +15% (co says it does not face any near term liquidity or solvency issues; also UBS upgrade), VPHM +5.8% (Piper upgrade ahead of Q2 report tomorrow in pre-mkt), XMSR +5.2% (Cramer thinks XMSR has bottomed and may be a takeover target, possibly by Sirius), NGAS +4.8% (extends yesterday's 12% move), BUH +2.5%, AMD +2.1% (IBM to expand AMD chip use as Intel steps up counterattack - WSJ), MT +2% (reports tonight), CHK +1.7% (Goldman upgrade), NTRI +1.5% (announces stock repurchase plan), NVO +1.1%, ASMI +1% (Needham upgrade)...Under $3: CD +20% (Wyndham and Realogy splits from company today), OSCI +16% (approval of Factive tablets in Mexico), AIRN +6.4% (enters into financing deal).
• Gapping Down
  Gapping down on disappointing earnings/guidance: ZVXI -23%, CYBX -16% (guidance only), AFFX -15.6% (also Thomas Weisel downgrade), PWAV -11.5% (also multiple downgrades), WFMI -9.3%, EXPD -8%, PLAB -7.3% (guidance only), CMG -4.3%, VMC -2.9%, PFG -2.3%, UTHR -2.2%, ISSX -1%... Other News: HOTT -13.5% (weak July comps, guides lower), ANR -3% (delays earnings announcement), RACK -2% (Cramer negative on Mad Money), RMBS -1.9% (profit taking after 13% move yesterday), FLSH -1.9% (JP Morgan downgrade), TS -1.6%, AKAM -1.2% (profit taking after 30% move in last 3 days), SNDK -1.2% (boutique firm says another bidder could come in and drive up price for FLSH).
• WFMI Whole Foods: Color on quarter (57.51 )
  RBC says that WFMI's Q3 earnings release was a mixed bag. Underlying business trends remain robust, but investor concerns over slowing comps are unlikely to subside in the near term. Firm says positive takeaways are 1) EPS beat consensus by a penny; 2) margin trends appear very strong; and 3) the high end of management's preliminary FY-07 sales and store contribution profit guidance supports our estimates, leaving firm's earnings ests for 4Q06 and FY-07 unchanged. Firm believes the Q surfaced some question marks about the direction of comps, as well as anticipated square footage growth for FY-07. Factors leading firm to this conclusion includes: 1) comps for the quarter were a touch light (10% vs. firm's est of 11%); 2) FY-06 sales guidance was tempered slightly and implies a very wide range for comps in Q4; and 3) management appears to have backed off of its preliminary FY-07 square footage growth guidance provided last quarter. Firm believes WFMI's comp decleration is more of a function of a less vibrant consumer and the "law of large numbers." BofA maintains their Buy on today's weakness following an inline qtr and comps of 9.9% below their 11.1% est. Firm maintains EPS ests given that margins at 6.1% were above our 5.95% est. Given recent concerns around the strength of the high-end consumer, some investors may choose to stay on the sidelines until there is some stabilization of sequential comp numbers. Firm believes, however, that the stock is attractive at these levels.
• CHK Chesapeake Energy upgraded to Buy from Neutral at Goldman (32.90 )
• EMR Emerson beats by $0.02; raises guidance (78.92 )
  Reports Q3 (Jun) earnings of $1.18 per share, $0.02 better than the Reuters Estimates consensus of $1.16; revenues rose 16.8% year/year to $5.22 bln vs the $5.07 bln consensus. Co raises guidance for FY06, to EPS of $4.33-4.38 from $4.25-4.35 vs. $4.36 consensus.
• Cramer's 'Mad Money' Recap - TheStreet.com
  On Monday's edition, Jim believes that Amazon (AMZN) needs to fall further before it can be a buy. He added that the co's earnings growth is decelerating, and it needs to be trading at half of where it is now. He also predicted Barnes & Noble (BKS) will report a bad quarter and advised investors to wait until this happens and then buy shares. Next, he thinks XM Satellite (XMSR) has bottomed and thinks it's worth buying. He feels the co is a takeover target as well, possibly by Sirius (SIRI). XM has some problems with the FTC, but it may prove to be a short-term issue. Finally, he still thinks stocks like Altria (MO) and Wells Fargo (WFC) are values at current levels.

long CHK, EMR, WFMI