I could never really see the charm in those horrid Crocs Inc. (NASDAQ: CROX) plastic footwear, so I never joined in the hype and wasn't part of that fun ride that Crocs shareholders enjoyed for a while. Crocs went public almost three years ago in February 2006. The stock has since split 2:1 in June 2007, peaked at $75.21 in October 2007, and yet today it trades under a dollar.
Crocs problems haven't started with the current economic slowdown; cheap knock-offs hurt sales and competitors marketed similar products. Not to mention the bad publicity Crocs had to manage following some injuries caused by Crocs getting caught in escalators.
Wal-Mart Stores Inc (NYSE: WMT) reported better-than-expected quarterly profit Thursday morning, as the world's biggest retailer benefited from deteriorating global economic conditions as shoppers looked for discounted goods.
Earnings from continuing operations were 77 cents per share, beating estimates by a penny. Sales rose more than 7% to $97.6 billion. The discount retailer, however, lowered its full year guidance, mostly citing currency exchange effects. WMT shares were trading lower at the open.
Intel Corp. (NASDAQ: INTC) sharply cut its fourth-quarter sales projection Wednesday to about $9 billion, down from a previous estimate of $10.1 billion to $10.9 billion. Following Cisco Systems Inc. (NASDAQ: CSCO)'s warnings, as well as a few others, that orders dropped significantly during October, this is further indication that technology spending has been grinding to a hlat as the economic slowdown continues. INTC shares were down 4.2% in premarket trading (7:58 am), but were flat an hour into the session.
Citigroup Inc. (NYES: C) -- The board is considering replacing its chairman Sir Win Bischoff, the Wall Street Journal reported, citing people familiar with the matter, but a spokesman denied it. A leading candidate is Richard Parsons, Time Warner Inc. (NYSE: TWX)'s chairman. [Update: 9:30: The WSJ also reported that Citi is in talks to buy U.S. regional lender Chevy Chase Bank FSB, which operates in the mid-Atlantic region. Citi shares are trading 1.7% higher in premarket (7:56 am), but traded 5% lower around 11 a.m.
Siemens (NYSE: SI) on Thursday reported a widening fiscal fourth-quarter loss to 2.47 billion euros ($3.1 billion) and said it would be more difficult to meet its profit target for the current year. Operating profit for its core sectors of industry, energy and healthcare dropped 24% to 1.49 billion euros. Sales rose 7% to 21.65 billion euros as demand from China and Europe offset U.S. weakness. SI shares rising in Germany and traded 4.4% higher in premarket (7:25 am). SI shares are adding 7% to their value during the session.
This week, some apparel and accessory producers and retailers offer a look at how they've been doing between early summer's economic stimulus spending and the coming holiday season. While Polo Ralph Lauren Corp. (NYSE: RL) reported higher earnings last week, Coldwater Creek Inc. (NASDAQ: CWTR), Eddie Bauer Holdings Inc. (NASDAQ: EBHI), Kenneth Cole Productions Inc. (NYSE: KCP), and K-Swiss Inc. (NASDAQ: KSWS) all reported net losses as consumers pulled back on spending over the summer due to higher fuel prices and other economic worries. The expectations of analysts surveyed by Thomson Financial for such companies scheduled to report this week don't look much different; i.e., a bright spot or two among lower expectations overall.
Hip retailer Urban Outfitters Inc. (NASDAQ: URBN) is expected to post earnings 22.9% higher than a year ago, to $0.35 per share, on revenue of $475.9 million (+26.4%). The Philadelphia-based company already said that same-store sales in the quarter were 10% higher. Urban Outfitters has beat expectations in recent quarters, by 11.5% in the previous quarter, and analysts on average recommend buying URBN. Shares fell to a 52-week low of $16.61 per share on Friday, and are down 29.5% from a year ago. Other companies expected to report more modest earnings growth in the coming week include watch and accessory maker Fossil Inc. (NASDAQ: FOSL), retail giant Wal-Mart Stores Inc. (NYSE: WMT), and TJX Companies Inc. (NYSE: TJX), parent of such discount retail chains as T.J. Maxx and Marshalls. These three companies have tended to top analysts estimates in recent quarters, and Fossil and TJX ended the week near their 52-week lows.
While Los Angeles-based American Apparel Inc. (AMEX: APP) had a strong second quarter, the casual wear maker is expected to report $0.13 per share earnings for the third quarter, the same as in the year-ago period. And analysts anticipate that Kohl's Corp. (NYSE: KSS) will report that profits fell 16.4% to $0.51 per share on revenue of $3.9 billion (+1.9%). Though same-store sales for October fell 9%, the Menomonee Falls, Wis.-based company reaffirmed its third-quarter forecast. Kohl's has offered positive surprises in recent quarters, topping estimates by 5.6% in the previous quarter. The consensus recommendation remains to buy KSS. Shares have been climbing after reaching a 52-week low in late October, but are still down 32.8% from a year ago.
Heelys (NASDAQ: HLYS) has looked interesting to me for the past few months. Sure, it's a fad product that's way past its prime but look at the balance sheet: the stock is trading very close to its book value and has $96 million in cash on the balance sheet, compared with a market cap of just over $130 million. The company also has no debt.
Apparently Skechers (NASDAQ: SKX) sees some value here too. In a press release issued after the close of the market yesterday, Skechers announced that, on May 28th of this year, it had made a formal proposal to acquire Heelys. The proposal was rejected without being disclosed to shareholders, and now Skechers is taking the battle to the streets, offering to acquire the entire company for $5.25 per share, a premium of just 8.2% to Tuesday's closing price.
Shares of Heelys traded up to $5.35 after-hours, indicating that investors anticipate that Skechers -- or someone else -- may come through with a more compelling offer.
From a corporate governance and transparency perspective, I think it's disappointing that Heelys didn't disclose the original offer to its shareholders. But given the state of the economy, and its beaten down share price, Heelys can probably make a strong case for staying the course as a stand-alone company, at least for now. If Skechers really wants Heelys, it will up the offer -- the company has to realize that a premium of 8.2% is just not very compelling.
Given the interest in Heelys, you also have to wonder whether fellow fallen angel of footwear fads Crocs (NASDAQ: CROX) could also end up in play soon.
Crocs announced a "new retail channel strategy. . . designed to elevate the Crocs brand, create more cohesive product alignment for its retail partners and pave the way for its popular, comfortable shoes to be easily available in the wide variety of retail environments where its core customers shop."
What exactly does that entail? Crocs doesn't really elaborate. Maybe it has something to do with trying to get the products out of Costco Wholesale Corporation (NASDAQ: COST). The other part of the press release is the announcement of some new footwear styles -- upmarket Crocs priced anywhere from $54.99 to $69.99 for "a high performance boating shoe that combines Crocs lock ™ H2O pods for advanced wet traction and the Crocs Exo-Frame that wraps the foot with a protective Croslite ™ material shell for a supportive fit."
Guess investors aren't too excited: the stock is down nearly 9% as I write this.
If you were looking for another hard day of profit taking on a summer Friday, the markets escaped the hangman. A barely positive durable goods of big ticket items was enough to send the pessimists to the showers and gave the bulls a little more ammo. Throw in an oil ticker showing a drop of more than $2.00 to almost $123.00 per barrel and that's all that was needed. Look at bond yields and you'll see we gave back almost all of yesterday's move.
Arch Coal (NYSE: ACI) tripled earnings posted EPS of $0.78 vs. $0.64 estimates. The stock was up more than 3% in pre-open but was up almost 9% at $55.45 in the final minutes of the day.
Crocs Inc. (NASDAQ: CROX) led the garbage stocks after a very ugly earnings warning last night. It now sees sales for all of 2008 modestly lower than 2007 and is now only targeting a break-even result for 2008. Retailers were noted as keeping inventory re-orders at low levels, which is hard to blame them considering the ugly shoe fad has already started its workdown. Shares were down 44% at $4.99 after shares had already sold of more than 80% from 52-week highs.
Crocs (NASDAQ: CROX) is trading at $5.06 late this morning, well below its close of $8.94. CROX lowered Q2 and 2008 financial guidance. Robert Baird Co lowered its rating to Neutral from Outperform. CROX over all option implied volatility of 91 is above its 26-week average of 84 according to Track Data, suggesting larger price movement.
Mechel Steel (NYSE: MTL) closed at $22.84, and is trading up this morning at $26.40. MTL sold off 38% on July 24 after Russian Prime Minister Vladimir Putin ordered antitrust authorities to investigate selling prices at steel and coal group MTL. MTL August option implied volatility is at 162, October is at 105, above its 26-week average of 66 according to Track Data, suggesting larger price fluctuations.
Elan Corp (NYSE: ELN) closed at $32.34 and, as of 11:15 Friday morning, is trading at $33.43. ELN's & WYE's Bapineuzumab (Alzheimer's treatment) Phase 2 trial results will be presented at the International Conference on Alzheimer's Disease on July 29. ELN August option implied volatility is at 97, October is at 70; above its 26-week average of 69 according to Track Data, suggesting larger price fluctuations.
Options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.
World's Largest Owner of Shopping Malls on Hot Seat A Senate report released last week alleges the owner's of Westfield malls; father (Frank Lowy) and son (Peter Lowy) used bank accounts in Liechtenstein to hide money from Uncle Sam as well as the Australian government. The Lowy family denies any wrongdoing and will have the chance to make its case in person this week, as Peter Lowy is scheduled to appear before a Senate investigations subcommittee today. Westfield Unhurt by Lowy Tax Woes - BusinessWeek
U.S. stock futures were lower Friday morning, a day after a selloff triggered by housing data. Today investors are bracing for more housing data at 10:00 a.m. EDT after already hearing that foreclosures soared 121% during the second quarter. Other point of interest will be durable goods data reported an hour before the opening bell. Meanwhile, oil continued the steady climb that started Thursday as the dollar weakens, trading above $126 a barrel. It's Friday, and no many earnings reports are due.
While there aren't many earnings reports today, there are a few including Fortune Brands (NYSE: FO), Netflix (NASDAQ: NFLX) and Black & Decker (NYSE: BDK) among others.
Crocs (NASDAQ: CROX) shares are tanking over 44% to $5 after after it cut its earnings outlook significantly on softer demand for its plastic shoes. With all those knockoffs around, is it any wonder? Robert W. Baird downgraded Crocs from Outperform to Neutral, slashing the target price from $21 to $5.
Meanwhile, Juniper Networks (NASDAQ: JNPR) surged 12% in premarket trading after the company not only beat estimates when reporting quarterly results Thursday, but also increased its sales forecast for the third-quarter much higher than analyst estimates. Friedman Billings and Citigroup both upgraded Juniper to Outperform and Buy respectively.
In deal news, Clear Channel Communications (NYSE: CCU) shareholders on Thursday approved a $17.9 billion takeover by private equity funds Thomas H. Lee Partners and Bain Capital. This ends the 20-month long effort.
Quarterly revenue guidance revised down to an approximate range $218 million to $223 million from $247 million to $258 million. The company said it expected its 2008 sales to be down slightly from the prior year.
Earnings per share guided down to 3 to 7 cents from 42 cents to 47 cents. For the full year, the company expects earnings of approximately $0, including the effect of a $20 million charge associated with the shuttering of its Canadian plant.
CEO Ron Snyder commented that "While we did experience solid sell-through with many of our major accounts, retailers across the board were extremely cautious with their level of reorders, choosing to operate with leaner inventories versus a year ago."
With the stock down to around $5 per share, bargain hunters might be intrigued. The stock is trading right around its book value and, assuming the company doesn't have serious inventory problems, it could be an attractive buyout target. But given the questions about management's forthrightness that I've raised in the past, I'll be staying away.
Brand-Name Stocks Uner $10: Buyer Beware These well-known names in the bargain bin may look appealing, but experts advise laying off until their earnings picture is clear. Among the stocks to be weary of are Sprint Nextel, Motorola, Ford Motor, Qwest, Washington Mutual, Northwest Airlines, Del Monte, Rite Aid, Chico's, Crocs, United Airlines, Palm, Sealy, Blockbuster, Circuit City and Orbitz. Brand-Name Stocks Under $10: Buyer Beware
With its stock in the toilet as the hype surrounding its ugly, clog-like, sandal shoes subsides, Crocs Inc. (NASDAQ: CROX) has taken to putting out daily press releases announcing pretty much anything. From May 13th through the 16th, the company actually managed to announce something every single day.
First the company announced that it had won a $56 million judgment against a company that had the audacity to produce charms for its footwear, violating the intellectual property of its Jibbitz company. But the stock failed to budge and the company didn't comment on the collectability of that judgment.
Then on the 14th, the company announced that it had launched "www.CitiesByFoot.com, a comprehensive website with guides to more than 70 shops, restaurants, boutiques and historic destinations in six U.S. cities." Just what we need: another travel site.
I could never really see the charm in those horrid 
Shares of 
Here are some highlights from this past week's 
If you were looking for another hard day of profit taking on a summer Friday, the markets escaped the hangman. A barely positive durable goods of big ticket items was enough to send the pessimists to the showers and gave the bulls a little more ammo. Throw in an oil ticker showing a drop of more than $2.00 to almost $123.00 per barrel and that's all that was needed. Look at bond yields and you'll see we gave back almost all of yesterday's move. 
Crocs
U.S. stock futures were lower Friday morning, a day after a selloff triggered by housing data. Today investors are bracing for more housing data at 10:00 a.m. EDT after already hearing that 
Shares of 
With its stock in the toilet as the hype surrounding its ugly, clog-like, sandal shoes subsides, 
Global Q&A: A rocky road, but profits ahead
Could oil go as low as $40?
Great news: Auto industry considering prepackaged bankruptcy 
