Data Feed

Insider trading disclosed in filings out after the close yesterday
Buyers: Cash America Int’l (CSH 36.29) Officer bought 30K shares at $34.45… Physicians Formula Holdings (FACE 10.28) Director bought 8K shares at $10.08… Coleman Cable (CCIX 11.98) Officers (3) bought 16,500 shares at $10.88 – $11.09; CEO bought 3,400 shares at $11.55; Director bought 66,300 shares at $11.55… Strategic Diagnostics (SDIX 3.98) 10% Owner SRB Greenway Capital bought 37,600 shares at $3.93… Scottish Re Group (SCT 3.32) CEO bought 105K shares at $2.85… Knology (KNOL 14.10) 10% Owner Farallon Capital Partners bought 43,800 shares at $14.40… CAM Commerce Solutions (CADA 38.00) 10% Owner bought 10,037 shares at $34.99… Brookfield Homes (BHS 20.33) 10% Owner Brookfield Asset Mgmt bought 64,500 shares at $19.93… Transmontaigne Partners LP (TLP 30.35) Chief Operating Officer bought 9,800 shares at $30.29… Meruelo Maddux Properties (MMPI 5.71) Chairman bought 16,700 shares at $5.98… Salesforce.com (CRM 39.60) Director bought 5K shares at $40.06. Sellers: Stone Energy (SGY 31.29) Officer sold 10K shares at $31.70… Regency Energy Partners LP (RGNC 30.58) Officer sold 10K shares at $31.00… Interactive Intelligence (ININ 20.97) Chairman sold 20,400 shares at $21.04… Parallel Petroleum (PLLL 17.44) CFO sold 19,137 shares at $18.98; CEO sold 65,228 shares at $18.67; Chief Operating Officer sold 35K shares at $18.86; Officers (3) sold 180,228 shares at $18.46 – $18.81… Kforce (KFRC 14.82) Director sold 15K shares at $14.39… Erie Indemnity (ERIE 55.49) Former Officer sold 12,179 shares at $55.20… Mueller Water Products (MWA 13.08) 10% Owner Fairholme Capital Mgmt sold 20,500 shares at $14.79… Daktronics (DAKT 26.31) Chairman sold 20K shares at $26.22… RenaissanceRe (RNR 57.01) President sold 100K shares at $55.73… SEIC Investments (SEIC 25.24) Director sold 15K shares at $26.12… Akorn (AKRX 7.52) Officer sold 56,066 shares at $7.69… Riverbed Technology (RVBD 41.90) 10% Owner Lightspeed Venture Partners Entrepreneur sold 15K shares at $39.91… SBA Communications (SBAC 30.90) CEO sold 200K shares at $29.70… Micrus Endovascular (MEND 22.82) 10% Owner HBM Bioventures sold 59,661 shares at $23.11 – $23.36.

LEND Accredited Home Lenders announces strategic Restructuring (6.55 )
Co announces that it will take several steps to restructure the it’s overall operations in response to the ongoing turmoil in the non-prime mortgage industry. The co will implement the following changes to its loan origination and settlement services platforms: 1) substantially all of the retail lending business consisting of 60 retail branch locations and 5 centralized retail support locations will be effectively closed as of Sept 5, 2007, impacting approximately 480 positions nationwide. LEND will continue to operate its San Diego-based customer retention unit that assists the co’s loan servicing customers; 2) 5 of the co’s 10 wholesale divisions will be substantially closed effective Sept 5, 2007; 3) effective immediately, no new U.S. loan applications will be accepted, although the co will honor existing commitments; 4) the co’s settlement and insurance services division, Inzura Settlement Services, which provides appraisal, title insurance and other settlement services, will be substantially reduced; and 5) headquarters staff in San Diego, CA will be significantly reduced to approximately 220 people from its current workforce of approximately 400… With this restructuring and the recently announced trade of approximately $1 bln of the co’s loan inventory with a right to repurchase, the co believes that the cash flows from the co’s securitized loans, servicing income and other income will enable the co to maintain its downsized operations until market conditions improve and the co can resume loan origination operations. The co expects to maintain its three existing warehouse credit facilities with a total capacity of $1.6 bln for U.S. loan originations and $150 mln Canadian for Canada loan originations. The trade of loans substantially reduces the outstanding borrowings under the co’s warehouse credit facilities, as well as the co’s exposure to margin calls by the warehouse lenders.

ETFC E*TRADE: Downgrade details (15.57 ) -Update-
UBS downgraded ETFC to Neutral from Buy and lowered the tgt to $17.50 from $27. Firm believes ETFC’s areas of concern include its funding ability, its credit costs in its loan portfolio; its securities portfolio — given its $3 bln in ABS exposure, deteriorating trends, and the lack of transparent market pricing and its core banking franchise which focuses on mortgage related assets is likely to remain challenged thru 2008.

ROST Ross Stores reports in-line; guides Q3 in-line, Q4 & FY08 below consensus (27.39 )
Reports Q2 (Jul) earnings of $0.37 per share, in line with the Reuters Estimates consensus of $0.37; revenues rose 10.5% year/year to $1.45 bln vs the $1.45 bln consensus. Co stated, “Looking ahead, we are slightly more cautious now in our second half outlook as a result of a combination of macro economic factors, recent results and projections from other retailers, and our own sales trend that slowed versus plan beginning in mid-July. Although we hope to perform better, in light of these issues, we believe it is prudent to manage our business with somewhat more conservative sales and margin assumptions for the balance of the year.” Co issues in-line guidance for Q3, sees EPS of $0.33-0.37 vs. $0.36 consensus. Co issues downside guidance for Q4 (Jan), sees EPS of $0.62-0.68 vs. $0.71 consensus. Co lowers guidance for FY08, to EPS of $1.80-1.90 from $1.85-1.95 vs. $1.91 consensus.

Bond Watch: Slow Slide
The market is leaking gains as its primary source of fuel, flight to quality, is now running on fumes. Since the Fed intervened late last week the bonds have been trying to sort out policy implications with expectations juiced for a rate cut, but subsequent Fed commentary has likely disappointed those seeking such a move leading to a softening in sentiment for riskless assets. The 2-10-yr yield spread is backing off 2-yr steepness to 49.3 as curve trade unwinds some of the frantic push out. Bond prices in the EuroZone were given an extra kick the downside after factory orders reported higher-than expected while in Japan, bonds are suffering with sticker shock mostly keeping investors away. Treasuries are still fighting to hold recent gains with the retracement thus far highly orderly suggesting trade has not completely bought into the equity stability nor the tape bombs being defused. Volatility is likely to flare up again keeping downside moves in check. The market gets nothing to work with today as data is loaded up on the back-end & the Fed-sters take a break (barring unscheduled appearances). The buck is weaker as the safe-haven bid is leached from currencies & the carry traders dip their big, slightly less fat toes back into trade. Spot gold is up at 658.57 (+1.27) while crude oil is better by a bit at 69.78 (+0.21) with Hurricane Dean averting the gulf coast refineries. The euro is at 1.3482 & the yen is at 115.1650 while the 10-yr is -10/32nds yielding 4.630%.

MicroStrategy (MSTR) announces that Hallmark Cards has expanded its use of MSTR software for enterprise-wide reporting and analysis. GE Healthcare, a unit of General Electric (GE), announces that it has received FDA approval for its new mobile mammography product… iMergent (IIG) announces an agreement with VeriShip to provide StoresOnline Pro merchants with auditing services for their FedEx (FDX) and UPS (UPS) shipments… Med Discovery and DRAXIMAGE, the radiopharmaceutical division of Draxis Health (DRAX) announces that they have established a research collaboration agreement to explore the combination of Med Discovery’s targeted protein therapeutics with DRAXIMAGE’s radiopharmaceutical expertise in the therapeutic and diagnostics field… Connectix Cabling Systems and RiT Technologies (RITT) announce the formation of a strategic O.E.M. partnership between the two cos. Under the terms of the agreement, Connectix will use RITT solutions to bring state-of-the-art management capabilities to its structured cabling solutions for British Enterprise customers… Ditech Networks (DITC) announces that Mobinil has chosen its comprehensive Voice Quality Assurance solution to improve voice quality for its subscribers… Alimera Sciences and pSivida (PSDV) announce that enrollment has begun for the first human pharmacokinetic study of fluocinolone acetonide in Medidur, the companies’ investigational product for the treatment of diabetic macular edema.

Gapping up: ACH +16.7%, PGLA +16.3%, BCSI +15.4%, BYI +12.4%, MGM +12.2%, TECD +9.3%, AMTD +8.6%, BTJ +8.5%, DRYS +8.3%, CTIC +8.0%, NMX +7.3%, NBIX +8.2%, SPWR +5.7%, SCHW +5.1%, NTES +5.0%, RTP +4.7%, TOL +4.7%, BYD +4.6%, LVS +3.0%… Gapping down: ABIX -41.5%, EFUT -10.2%, MDT -1.6%.

JMP Securities raises their Myriad Genetics (MYGN 42.03) tgt to $50 from $47 following the co’s F4Q07 financial performance that handily beat consensus. Firm cites rev from molecular diagnostic products of $42.3 mln “crushed” their Street-high expectation of $41 mln, driven by strong demand with little, if any, favorable impact of price increases. However, the firm was disappointed that R&D spend will continue to grow even after the Flurizan program is complete… Morgan Keegan says that preliminary Q2 mkt share results show Alcatel-Lucent (ALU 10.62) gaining in Optical and IP/MPLS, and Arris (ARRS 14.75) posting gains in CMTS… ThinkEquity expects Zumiez (ZUMZ 44.38) to report very strong Q2 results today after the market closes. They estimate 11.5% same store sales growth drove revenues to $78.8 mln, up from $55.8 during 2Q06. They are expecting EPS of $0.08, compared to $0.06 during 2Q06. Maintains Accumulate and $43 price target… DA Davidson discusses RealNetwork’s (RNWK 6.30) JV with MTV/Viacom (VIA). Although the near-term bottom line impact is minimal, they think this partnership should help RNWK expand its digital music footprint and, therefore, improve its long-term viability. The firm views the partnership in a positive light… Punk Ziegel thinks Wachovia’s (WB 50.0) 14% dividend increase to $0.64 indicates the confidence that management feels in the co’s outlook. They say this confidence is backed by continuous increases in earnings in the past few years. Firm thinks that if WB would slow its external growth program and simply capture the benefits built into its franchise, the stock would be a top performer… Morgan Keegan notes that Marvell (MRVL 16.97) will be reporting full results Thursday evening for the first time since May 2006. The firm thinks a bloated cost structure makes street earnings expectations of $0.07 look like a stretch, thus they prefer their view of $0.06. While they believe MRVL should resume a healthy level of sequential revenue growth in the second half, their view of near term earnings is fairly bleak. Maintains Market Perform.

S&P futures vs fair value: +7.5. Nasdaq futures vs fair value: +8.5.
Early indications are pointing to a modestly higher open for equities. With very little in the way of M&A activity over the last few weeks, reports that TD Ameritrade (AMTD) and E*Trade Financial (ETFC) are in merger talks has renewed confidence about liquidity, valuations, and further industry consolidation in an influential sector that has been crushed by fears of a credit crunch. Investors are also embracing some semblance of stabilization in equities over the last couple of days and a growing sense that the Fed will still have to cut interest rates, perhaps even before the September 18 FOMC meeting.

Real-Estate brokers take a real bruising; Has sell-off gone too far? – WSJ
WSJ Reports brokerage cos have prospered along with commercial-real-estate mkts in the past few years, reaping record profits. But over five weeks, shares of the biggest co, CB Richard Ellis Group (CBG), have plunged 30% as the credit mess leads investors to predict a severe slowdown in property sales and worry that an economic slowdown could hurt leasing. Yet, some analysts and investors believe that the sell-off went too far. CBG isn’t the only commercial-real-estate services co being hit. Shares of Jones Lang LaSalle (JLL) were down 13% at the same time while those of the much smaller and more thinly traded co Grubb & Ellis (GAVU) are down 34%. Still, analysts and some investors think the stocks, and particularly CBRE, are oversold. “Clearly transaction volume will slow a bit, but a 35% sell-off (of CBG) seems to be a little overstated here especially with a company that has such a dominant market share,” says Joseph Betlej, vice president and portfolio manager for Advantus Capital Mgmt, which owns about 130,000 CBG shares, according to FactSet Research Systems. “I think the stock is trading down as if Wall Street believes that the investment sales spigot has been completely turned off,” says Will Marks, an analyst with JMP Securities, who rates CBG and JLL as strong buys. “That’s extreme, in my opinion.”

AAPL Apple: Moves by Wal-Mart and RealNetworks may mean more iPod sales – Latimes.com (127.57 )
Latimes.com reports that Wal-Mart Stores (WMT) and RealNetworks (RNWK) on Tue strengthened their digital music offerings to better compete with AAPL’s iTunes store. WMT began selling songs without anti-piracy locks for 94 cents apiece, and RNWKs’ Rhapsody subscription service announced new partners that would promote it on MTV and distribute it on Verizon (VZ) cellular phones. But the competition might actually help AAPL. That’s because AAPL makes a slim profit on selling songs but cleans up on every iPod music player. A robust market for digital songs should translate to more demand for the music players on which to play them, and AAPL’s iPod is the runaway leader. “ITunes was developed to promote iPod hardware sales,” said Susan Kevorkian, an analyst at research firm I.D.C. “The introduction of services that offer digital music to the installed base of iPod users will help drive more iPod sales.” WMT, the No. 1 overall music retailer, noted on its online store that the songs in the unrestricted MP3 format would “play on almost all portable media devices, including iPod and Microsoft (MSFT) Zune.

Missouri case could ring up cellphone taxes – WSJ
WSJ reports in recent years, state and local govts have been looking to monthly cellphone bills as a new source of tax revenue to make up for the growing number of consumers giving up their traditional telephones for wireless services. Now, a legal battle in Missouri could accelerate that trend, emboldening some state and local govts to increase cellphone taxes — and cellphone bills — even more. After a six-year legal struggle, a state court in St. Louis County this week may finally rule on whether a group of municipal telephone license taxes — worth an estimated $500 mln statewide — apply to services offered by wireless carriers. The Missouri case is among the most important attempts by the states to tax cellphone bills — it involves a large amount of money and some major companies, including AT&T Inc. (ATT), Sprint-Nextel (S) and Verizon Wireless, a JV of Verizon Communications (VZ) and Vodafone Group (VOD). The case could result in a big financial hit to the carriers, which until recently have resisted collecting the tax from their customers. That means they now could face having to pay the bill, plus interest and penalties.

Mortgage Market Overview: De-leveraging destroying value, new capital needed – FBR
Friedman Billings says with the unusual amount of balance sheet deleveraging occurring in cos that hold mortgages, they believe that roughly $150 to $250 bln of permanent capital is needed to normalize pricing in the mortgage market. The big question is: Who will supply this permanent capital when many investors believe that housing assets are impaired? The Fed cutting rates will not bring permanent capital to mortgage market, only the adjustment of the prices for current and new mortgage products would entice capital back into the space. This price adjustment will take time and will be very painful. Firm believes it will take 6 to 12 months for the prices of mortgage assets to adjust and for capital to flow back into the space.

BCSI Blue Coat beats by $0.08; issues upside Q2 guidance (59.85 )
Reports Q1 (Jul) earnings of $0.43 per share, excluding non-recurring items, $0.08 better than the Reuters Estimates consensus of $0.35; revenues rose 71.4% year/year to $62.4 mln vs the $58.8 mln consensus. Co issues upside guidance for Q2, sees EPS of $0.43-0.50, ex-items, which translates to $0.21-0.25 per share reflecting the effect of the upcoming stock split, vs. $0.37 consensus; sees Q2 revs of $67-70 mln vs. $61.65 mln consensus. CEO says, “We attribute delivery of this quarterly record net revenue to our increasing success in the WAN Application Delivery market. Clearly our customers see the value in our unique ability to provide security and high speed application delivery in one appliance, our ProxySG(R) product.”

GOOG Google aims to make YouTube profitable with ads – NY Times (506.61 )
NY Times reports ever since Google bought YouTube last Nov, it has avoided cluttering the site and the video clips themselves with ads, for fear of alienating its audience. Now Google believes it finally has found the formula to cash in on YouTube’s potential as a magnet for online video advertising and keep its audience loyal at the same time. The co said late Tuesday that after months of testing various video advertising models, it was ready to introduce a new type of video ad, which it said was unobtrusive and kept users in control of what they saw. The ads, which appear 15 seconds after a user begins watching a video clip, take the form of an overlay on the bottom fifth of the screen, not unlike the tickers that display headlines during television news programs. For now, Google will place the ads only on video clips of its content partners — the more than 1,000 small and large media cos that have licensed their videos to YouTube. By doing so, YouTube will avoid the potential liability of having ads appear on copyrighted clips it is not authorized to display. And it will also prevent ads from playing on clips generated by users whose message may not be to the liking of advertisers.

Carlyle rescues mortgage fund – WSJ
WSJ reports another big buyout firm, Carlyle Group, has run into bond-mkt turmoil, putting up $100 mln to meet margin calls on a European mortgage investment affiliate with $22.7 bln in assets. Carlyle extended a one-year loan at 10% interest to help Carlyle Capital meet lender demands for additional funds. Many Carlyle partners, including co-founders David Rubenstein, Daniel D’Aniello and William Conway, collectively own a minority stake in the mortgage fund. In a statement, Carlyle Capital said that even though 95% of its assets are “AAA mortgage-backed securities with the implied guarantee of the U.S. government, the fair value of these assets has declined due to diminished demand for these securities in the marketplace.” So far, the Carlyle situation doesn’t appear as serious as that reported last week by a specialty-finance affiliate of Carlyle rival Kohlberg Kravis Roberts.

Upgrades: UBS upgrades Lowe’s (LOW 28.91) to Buy from Sell… Credit Suisse upgrades ENI S.p.A. (E 63.64) to Outperform from Neutral based on the co’s 6% cash yield and low valuation… CIBC upgrades Bally Tech (BYI 27.42) to Outperform from Sector Perform and raises their tgt to $35 from $28 saying they believe initiation of FY08 guidance is encouraging and limits the effect of overdue FY07 filings. The firm also believes the guidance reflects accelerating product acceptance and recovering profitability heading into a positive fundamental period. Downgrades: Deutsche Bank downgrades Pearson (PSO 14.93) to Hold from Buy saying its education unit could suffer from pressure on U.S. state tax revenues over the next couple of years, while its business news unit has been the main loser from recent deals in the sector… Credit Suisse downgrades Estee Lauder (EL 40.92) to Neutral from Outperform and cuts their tgt to $44 from $53 based on the step up in spending and the expectation for a weak 1H08, the firm believes that the visibility at EL has been reduced and that it may now take more time for the company to reach its full potential. Miscellaneous: CIBC initiates Centene (CNC 19.82) with a Sector Perform and a $20 tgt saying the stock is cheap, but Centene’s guidance is premised on its medical loss ratio improving more than 100 basis points in the second half of the year, which feels a little aggressive… CIBC initiates Riverbed Technology (RVBD 41.90) with a Sector Perform saying while market fundamentals are solid and RVBD has the strongest momentum of segment players, the stock is expensive, the mobile opportunity is a wild card, and CSCO is a mounting risk… Morgan Stanley initiates Telmex (TMX 32.16) with an Equal Weight.

Upgrades: Bear Stearns upgrades Centurytel (CTL 44.56) to Outperform from Peer Perform… Merrill upgrades Centurytel (CTL 44.56) to Neutral from Sell… Merrill upgrades US Airways (LCC 28.51) to Buy from Neutral… UBS upgrades Georgia Gulf (GGC 15.12) to Neutral from Sell… Merrill upgrades Cameco (CCJ 36.28) to Buy from Neutral… J.P Morgan upgrades Lowe’s (LOW 28.91) to Overweight from Neutral…UBS upgrades Cambell Soup (CPB 35.95) to Buy from Neutral saying they believe CPB currently stands at an inflection point in its intermediate-term growth pattern, and that the stage looks set for growth to accelerate as the company re-focuses on its core businesses and becomes a fundamentally more efficient operation. Downgrades: Jefferies downgrades American Capital Strategies (ACAS 40.72) to Hold from Buy and maintains their $40 tgt, based on an increasing reliance on equity investment dividends, growing exposure to highly levered securities, and uncertainty surrounding the ability to continue to transfer risk to third parties and see the end of the credit cycle nearing… UBS downgrades ETRADE Finacial (ETFC 15.57) to Neutral from Buy. Miscellaneous: Merrill initiates Eclipsys (ECLP 23.86) with a Neutral… UBS initiates Triumph Group (TGI 74.31) with a Buy.

Sensex ends up 260pts at 14,249 – The Business Standard
The Business Standard the Sensex opened with a positive gap of 66 points at 14,055. After extending gains in early trades the index, thereafter, slipped into the negative zone. A heavy bout of selling in late morning trades saw the index tumble to a low of 13,871 -down 184 points from the day’s open. The index, however, soon rebounded into the positive zone on the back of renewed buying interest in heavweights. The index rallied to a high of 14,281 -up 410 points from the day’s low. The Sensex finally ended with a gain of 260 points at 14,249.

Asian stocks rise for third day on U.S. interest rate outlook – Bloomberg.com
Bloomberg.com reports Asian stocks gained for a third day on speculation the U.S. Federal Reserve will lower interest rates to alleviate a credit crisis and sustain growth in the world’s biggest economy… Japan’s Nikkei 225 Stock Average was little changed while the Topix index lost 0.3%… The CSI 300 Index exceeded 5,000 for the first time in China, where the central bank yesterday said it was raising interest rates for the fourth time since March. Benchmarks gained elsewhere across the region, except in the Philippines and Taiwan.

Global stocks, U.S. futures rise; SocGen, BHP, Elpida advance – Bloomberg.com
Bloomberg.com reports European and Asian stocks gained and U.S. index futures climbed on speculation the Federal Reserve will cut interest rates to ease a credit crunch and sustain economic growth… The yen fell against all major currencies on speculation the Bank of Japan will refrain from raising rates because of the global credit-market crisis. U.S. 10-year notes slid for the first day in five and European two-year government notes also retreated. The risk of owning European corporate bonds declined, according to traders of credit-default swaps… National benchmarks gained in all of the 17 western European markets that were open. The U.K.’s FTSE 100 rose 0.8%, as did Germany’s DAX. France’s CAC 40 jumped 1.2%.

Wilbur Ross plans push into subprime – Financial Times
The Financial Times reports Wilbur Ross, the US financier who specialises in distressed businesses, is planning a push into subprime mortgages in a sign the credit turmoil is opening up opportunities for bargain-hunting, risk-taking investors. In an interview with the Financial Times, Mr Ross said the subprime market was a new focus for his private equity firm, WL Ross. He said WL Ross, which has about $3.5 bln under management, was also looking at investing in German small and medium-sized companies after the subprime-related problems at two banks serving the country’s Mittelstand. Mr Ross said his exposure to the subprime market could come through acquisitions of lenders, mortgage portfolios or even companies that service loans. “We are going to be in subprime, it is a valid business,” he said. “There is nothing wrong with lending subprime, what is wrong is doing it recklessly,” he added, arguing the sector’s downfall was due largely to bad practices such as lending to borrowers without documents.

Insurers’ stocks starting to look cheap to some, despite subprime risk – WSJ
The Wall Street Journal reports insurance stocks have been hit hard by the mortgage-market tumult, and that has created opportunities for investors willing to overlook some dings and scratches in companies that should generate healthy profits over the long term. Among the stocks trading at attractive prices are Genworth Financial (GNW), Allstate (ALL), Hartford Financial Services Group (HIG), Chubb (CB) and ACE Ltd. (ACE). Some of these stocks could be hurt one way or another by subprime mortgages gone bad, but any losses could be minor compared with their overall profits. “The P&C insurer stocks could be poised to recover sharply upon reporting third-quarter results that might show no erosion in book value,” Lehman Brothers analyst Jay Gelb wrote in a research report, referring to property and casualty insurers. He has “buy” ratings on Chubb and ACE, which he says have “immaterial exposure” to subprime, and “hold” ratings on Allstate and Hartford, which have subprime and Alt-A exposures as a percentage of book value of 19% and 12%, respectively. Allstate has reported subprime exposure of $4.8 bln. Dan Hale, Allstate’s CFO, has said the insurer is “comfortable” with its subprime holdings. The company currently trades at about 1.5x book value, below its historical median of 1.6x, suggesting that investors have priced in their concerns. Hartford has reported subprime exposure of $3.4 bln, while Chubb has said it has no subprime exposure. ACE has about $280 mln in subprime-loan exposure, which is broadly diversified. As of June 30, Genworth had $2.1 bln invested in bonds backed by subprime loans, out of a total of $72.6 bln in invested assets. Of the subprime-backed bonds, 41% are rated AAA and 25% are rated AA, the co says.

MGM MGM approves $5 bln deal for Dubai to acquire 9.5% stake – WSJ (74.32 )
The Wall Street Journal reports Dubai World, a holding co for the Persian Gulf state, has announced a $5 bln deal to eventually acquire a 9.5% stake in Kirk Kerkorian-controlled MGM Mirage (MGM) and 50% ownership in the co’s CityCenter project. Under the deal, approved yesterday by MGM Mirage’s board, Dubai World will pay $2.7 bln to acquire its stake in CityCenter, a 76-acre development of upscale hotels, condos and retail slated to open by 2009. Dubai World will also buy 14 mln shares from MGM Mirage at a price of $84 per share, or about $1.2 bln, a premium of about 13% over yesterday’s price of $74.32. The deal will result in a $3.9 bln cash infusion for MGM Mirage. Under the deal with Dubai World, Mr. Kerkorian’s stake in MGM Mirage will shrink slightly to 51.65% from 54.15%, but he will remain the majority shareholder through Tracinda, his investment co. Dubai World has agreed to pay MGM an additional $100 mln if CityCenter opens on budget and on time by the end of 2009. MGM officials said the deal’s cash infusion will allow MGM the capital to acquire more properties or pursue other development, and help reduce its future debt.

ETFC TD Ameritrade in merger talks with E*Trade – WSJ (15.57 )
The Wall Street Journal reports TD Ameritrade (AMTD 16.35) and E*Trade (ETFC) are holding merger discussions. A spokeswoman for E*Trade said the firm’s management team has consistently stated it believes there is “tremendous value in consolidation that aligns business strategy and operational synergies and will do what is in the best interest of its customers.” A TD Ameritrade spokeswoman said, “We have talked and continue to talk to peers in the industry.” E*Trade and TD Ameritrade have been in serious discussions for weeks but aren’t yet close to a deal, according to people familiar with the matter. They have discussed an alliance several times in previous years but have never managed to make it to the altar. This time, however, they may feel more pressure to reach a deal. Two hedge funds with big stakes in TD Ameritrade have publicly urged the two companies to talk. The two funds — Jana Partners LLC and S.A.C. Capital — have argued that Toronto-Dominion Bank, which owns 39% of TD Ameritrade, opposes a merger of the co because its interests aren’t fully aligned with other shareholders. The funds, which own a combined 8.4% of TD Ameritrade, contend that the Canadian bank wants to use the online broker to grow in the U.S. and isn’t necessarily focused solely on maximizing shareholder value. TD Bank has publicly disagreed with that characterization of its position. Even so, Jana and S.A.C. successfully pressured TD Ameritrade to remove TD Bank’s chief executive from the online broker’s mergers and acquisitions committee in early July. It isn’t clear what a merger deal between E*Trade and TD
Ameritrade would be worth or how it might be structured. One person familiar with the talks estimated a deal could create a co valued at as much as $20 bln, given the cost saving that could result from uniting both company’s accounts on a single computer system. The consolidation would make the cost of adding new clients minimal. A person familiar with the merger talks said the discussions currently are focused on making sure both online brokers agree on strategy.

TOL Toll Brothers reports Q307 results; beats by $0.11 (21.09 )
Reports Q3 (Jul) earnings of $0.16 per share, includes pre-tax write-downs, $0.11 better than the Reuters Estimates consensus of $0.05; revenues fell 20.8% year/year to $1.21 bln vs the $1.16 bln consensus. Results include pre-tax write-downs of $147.3 mln. Exluding write-downs, EPS for Q307 would have been $0.70. Co declined to give earnings guidance two weeks ago, citing market conditions.

‘Mad Money’ Recap: Lightning Round cont. – TheStreet.com
Cramer was bearish on Dean Foods (DF), Banco Popular (BPOP), Parker Drilling (PKD), Foster Wheeler (FWLT) and First Solar (FSLR).

‘Mad Money’ Recap: Lightning Round – TheStreet.com
Cramer was bullish on Aecom Technology (ACM), Jacobs Engineering Group (JEC), Wachovia (WB), Schlumberger (SLB), Transocean (RIG) Tata Motors (TTM), E*Trade Financial (ETFC), American Capital Strategies (ACAS), Hudson City Bancorp (HCBK) Level 3 Communications (LVLT) and Tessera Technologies (TSRA).

‘Mad Money’ Recap: Sudden Death Round – TheStreet.com
During the “Sudden Death” round, Cramer was bullish on Principal Financial Group (PFG), LCA-Vision (LCAV) and IBM (IBM).

Cramer’s ‘Mad Money’ Recap – TheStreet.com
On Tuesday’s edition, Jim recommendes Procter & Gamble (PG) for its yield and provides a $90 tgt. Next, he suggests PetSmart (PETM) and favors its lack of competition.