Markets: News  

Stocks to watch Tuesday: AMD, ASML, Beazer

WASHINGTON (MarketWatch) -- Among the stocks that could see active trade in Tuesday's session are Advanced Micro Devices Inc., ASML Holding NV and Beazer Homes USA Inc.

Shaw Group Inc. (SHAW) , Wolverine Worldwide Inc. (WWW) and Helen of Troy Corp. (HELE) stand out among the companies scheduled to report their quarterly financial results. VOXX International Corp. (VOXX) , Penford Corp. (PENX) , OCZ Technology Group Inc. (OCZ) , SemiLEDs Inc. (LEDS) , Zep Inc. (ZEP) and Hi-Tech Pharmacal Co. (HITK) round out Tuesday's calendar.

A United Technologies Corp. (UTX) subsidiary signed an $8.5 billion contract to supply 653 Black Hawk and Seahawk helicopters to two branches of the U.S. military. Terms of Sikorsky Aircraft Corp.'s five-year deal with the Army and the Navy include a provision to increase the number of aircraft to as many as 916. If the Pentagon fully exercises the optional purchases, the value of the contract could reach $11.7 billion, Sikorsky said. Actual production quantities will be determined on a year-by-year basis depending on funding allocations as set forth by Congress as well as Pentagon priorities for systems acquisitions.

Also late Monday, Advanced Micro Devices (AMD) said it expects to report lower-than-forecast revenue for the second quarter. Sunnyvale, Calif.-based pegged the size of the top-line drop at 11% on a sequential basis, the result of poorer business conditions that materialized late in the June quarter, including a "weaker consumer buying environment." In addition, channel sales in China and Europe turned out to be softer than expected, AMD said. The company will formally report quarterly results July 19.

Intel Corp. (INTC) is the first company to take part in a program announced by Netherlands-based ASML (ASML) to encourage joint development of next-generation technology for manufacturing chips. Intel plans to invest about $3.1 billion to take a 15% stake in ASML over two phases and will commit a further $1 billion to research and development in 450-millimeter wafer technology and extreme ultraviolet lithography. ASML's program, open to other unnamed customers that it said are currently evaluating whether to join in, calls for the company to issue up to an 25% minority equity stake in aggregate. Cash proceeds from the share issuance will be returned to ASML's other stockholders in its entirety, the company said. ASML sees participating customers funding "a significant portion" of its R&D activities for the next five years.

Beazer Homes (BZH) commenced concurrent underwritten offerings of common stock and tangible equity units for sale to the public, the Atlanta-based company said. Beazer's selling $75 million in common stock as well as 3 million of the units, also equal to $75 million. Net proceeds will be used in part for some $100 million of potential land acquisitions in Florida, California, Texas, North Carolina and Arizona. The tangible equity units, which would be listed on the New York Stock Exchange under the symbol BZT, are made up of a prepaid stock purchase contract and an unsecured senior amortizing note due 2015. Underwriters will have 30-day options to buy up to an additional 15% of the tangible equity units as well as for an additional 15% of the common shares. Neither offering is contingent upon completion of the other, Beazer said.

DiamondRock Hospitality Co.(DRH) said it agreed to pay affiliates of Blackstone Real Estate Partners VI (BX) about $495 million for a portfolio of four hotels: the Hilton Boston, the Westin Washington, the Westin San Diego and the Hilton Burlington in Vermont. Separately, the Bethesda, Md.-based real estate investment trust said it plans to sell 20 million common shares in a secondary public offering. The underwriter will have a 30-day option to buy up to 3 million additional shares if needed to satisfy investor demand, DiamondRock Hospitality said.

Synageva Biopharma Corp. (GEVA) commenced the sale of $80 million in common stock via an underwritten offering. Underwriters will have a 30-day option to buy up to an additional 15% of stock. In January, Synageva, which is developing protein therapeutics for patients with rare medical disorders, generated $84 million in net proceeds from a secondary equity offering. As of March 31, the Lexington, Mass.-based company had a cash balance of $138.9 million and no outstanding debt.

The board of A.O. Smith Corp. (AOS) declared a quarterly cash dividend of 20 cents a share, payable on both the company's common stock and Class A common. It's a 25% increase over the prior dividend and marks the biggest such hike in 25 years, the Milwaukee-based company manufacturer of water heating equipment and boilers said.

Monday earnings recap

Alcoa Inc. (AA) reported a second-quarter net loss of $2 million, a reversal from the $322 million, or 28 cents a share, that the blue chip earned in the year-earlier period. The loss amounted to nil on a per-share basis. Adjusted to exclude various charges, Alcoa would have earned 6 cents a share for the latest quarter, as revenue fell to $5.96 billion from the prior year's $6.59 billion. Analysts, on average, had been looking for a profit of 5 cents a share on $5.8 billion in revenue, according to estimates compiled by FactSet Research. In the face of an 18% slide in realized aluminum prices, Alcoa affirmed its projection for a global aluminum supply deficit and demand growth of 7% for 2012.

WD-40 Co. (WDFC) posted a profit of $9.1 million, or 57 cents a share, for the third quarter ended May 31, up from $8.1 million, or 47 cents, earned in the year-earlier period. Quarterly sales edged up to $87 million from $86 million, the San Diego-based company said. Management also reiterated its full-year forecast calling for earnings of $2.33 to $2.45 a share on net sales pegged in a range of $353 million to $370 million. However, WD-40 also said it anticipates generating full-year European sales at a level flat with or lower than fiscal 2011 as a result of volatility in the region as well as in the oil market. Accordingly, "we expect to come in at the lower end of our guidance," said Chief Executive Garry Ridge in WD-40's earnings release.

Incurring higher costs, PriceSmart Inc. (PSMT) reported net earnings of $15.7 million, or 52 cents a share, for the third quarter ended May 31, off from $16.3 million, or 55 cents, earned in the same period during fiscal 2011. The San Diego-based warehouse-club retailer serving markets in Latin America and the Caribbean generated quarterly revenue that reached $506.8 million from the prior year's $431.1 million. Also, net warehouse-club sales for June totaled $163.7 million, up 18.7% from a year earlier, PriceSmart said.