NVTL, ZUMZ, AIV, SNE, BMC, LECO, CMC Popular Stocks
U.S. stocks plunged Friday, erasing all of the previous day’s big gains, as a drop in consumer spending fanned worries that the economic recovery won’t be sustainable. The Dow Jones Industrial Average slid 235 points to 9727, while the S&P 500 lost 28 points to 1039 and the Nasdaq Composite dropped 50 points to 2048.
Shares of Novatel Wireless Inc. (NASDAQ:NVTL, $9.02, -$3.17, -26.00%) tumbled after the provider of wireless broadband products said sales of its MiFi portable Wi-Fi network are likely to be flat to down slightly on a sequential basis in the fourth quarter.
Risk versus reward is now more attractive for Zumiez Inc. (NASDAQ:ZUMZ, $13.65, +$0.40, 3.02%), Jefferies said in raising the stock to buy. Jefferies added that successful merchandising, including promotions and “sharp pricing combined with a strong sales force,” is improving sales trends. Lean inventories and initial mark-up gains should drive margin improvement as well. Long term, it sees solid margin and store growth amid cost cuts, a more efficient supply chain and a greater focus on Internet business.
Apartment Investment & Management Co. (NYSE:AIV, $12.38, -$0.80, -6.07%) swung to a loss in the third quarter on a drop in both occupancy rates and average rents, as the apartment manager saw a key profitability metric fall.
Sony Corp.’s (NYSE:SNE, $29.49, -$1.05, -3.44%) extensive cost-cutting efforts are helping it grapple with continued soft consumer demand and strong yen, leading to a smaller-than-expected loss for its fiscal second quarter and an improved outlook for its fiscal year. But the Japanese maker of everything from digital music players to Hollywood movies warned that sales in the important Christmas period would continue to be weak due to continuing price erosion.
BMC Software Inc.’s (NASDAQ:BMC, $37.42, +$0.20, 0.54%) fiscal second-quarter profit grew 35% on improved margins as the maker of business software posted higher bookings but lower revenue. The company again raised its full-year earnings target.
Lincoln Electric Holdings Inc. (NASDAQ:LECO, $47.60, +$3.30, 7.45%) posted an 82% tumble in third-quarter profit as sales of the welding product maker dropped 30%, with sales declining in every region. Still, excluding some extra charges, the results aren’t as bad as those gloomy analysts expected and were better than a dismal second quarter. Chief Executive John Stropki says sales growth has continued into the fourth-quarter start and has made him cautiously optimistic.
Commercial Metals Co.’s (NYSE:CMC, $14.68, -$1.19, -7.50%) fiscal fourth-quarter profit fell 89% as the steelmaker and recycler saw revenue halved amid lower demand and falling prices.
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