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The Traders, The Strip.ers, The Dwarf & The Stretch Limo

As I have been lamenting in the trading room, we are in a market that has all the big moves in futures over nite. This has been the case for over 3 weeks now as the days seem to drip on lacking volume and the futures jam up or down each nite. After two slight down days we have rallied back here about 14 pts on the ES sitting @ 1460 this am. CPI is benign and housing starts is off as it should be with the mass exodus of buyers in the housing market. No reason to be building now as even the contractors finally are seeing the permanent market on the walls saying housing is in the dumpster for years to come.

Oil hanging up @ 87.6 this am premarket and gold trading 767 and keeps on rising. Inflation nation continues. Let’s see how the story develops today.

Gapping up: CNTF +42.0%, YHOO +9.4%, ASML +6.6%, CHL +6.6%, CBAK +6.0%, PTR +5.6%, SLT +4.4%, INTC +4.9%, LFC +4.6%, JPM +4.2%, DRYS +4.0%, IFX +3.9%, TTM +3.5%… Gapping down: CVC -3.6%. RTP -2.1%, QMAR -1.4%, IBM -1.1%, LVLT -0.9%.

Building Permits 1226K vs. 1285K, prior revised to 1322K from 1307K
CPI m/m +0.3% vs +0.2% consensus
Core CPI y/y +2.1% vs +2.1% consensus
Housing Starts 1191K vs. 1280K consensus, prior revised to 1327K from 1331K -Update-
CPI y/y +2.8% vs +2.8% consensus

S&P futures vs fair value: +9.7. Nasdaq futures vs fair value: +24.0.
The futures market is pointing to a strong opening due to a number of better than expected earnings reports. Intel (INTC), Yahoo! (YHOO), Seagate (STX), CSX Corp. (CSX), Altria Group (MO), Coca-Cola (KO), JPMorgan Chase (JPM) , United Technologies (UTX) and Abbot Laboratories (ABT) all topped consensus earnings estimates. IBM (IBM) reported earnings that were in-line with estimates.

IBM IBM: Reports mixed Q3 results - Credit Suisse (119.60 )
Credit Suisse notes IBM reported largely in-line 3Q07 results as revenue of $24.1 billion was in-line with the Street’s $24.1 billion estimate while EPS of $1.68 was $0.01 ahead of consensus of $1.67. Services delivered its strongest quarter in years with overall revenue growth of 14% y/y and profit growth of 27%, however, systems was disappointing owing to softness in financial services demand and product transitions. Firm is raising their FY07 EPS to $6.98 from $6.95 to account for the penny of upside from 3Q, but given their current 4Q ests already assume seasonality, they are only modestly raising 4Q.

Bond Watch: Knocking Around Unch
The market is a little mixed heading into the open. Bond prices managed to trend a little higher through the night only to be pushed back down as global equities regained their footing & yesterday’s modest flight to quality backslid with better corporate earnings reports. The 2-10-yr yield spread flattened to 52.3 off 54.4 overnight as curve trade awaits the day’s event risk. Bond prices in the EuroZone are holding higher despite the minor stock recovery while in Japan bond prices rallied as Asian equities continue to drag. Treasuries have some heavier hitting reports to help move trade around today. Inflation & housing reports could be a mixed bag & trade awaits their details. A surprise boost in inflation will send longs running for the doors while inline numbers probably will leave trade to wander within recent ranges. The Fed’s Beige Book hits late in the session but it should provide some regional economic context for the upcoming Oct 31 FOMC meeting. The dollar’s rally is losing steam but remains mixed as yen weakens & the euro chugs back toward 1.4200.Gold is flat 760.50 while crude is also flat at 87.60…if you wanna call that “flat.” Data up is CPI & housing start/permit (8:30) & the Fed’s Beige Book. The euro is at 1.4199 & the yen is at 116.9900 while the 10-yr is unchanged at 4.645%.

AAPL Apple initiated with a Buy at Soleil - tgt $200 (169.58 )

UTX United Tech beats by $0.01, beats on revs; guides FY07 EPS at top end of previous guidance, revs above consensus (79.65 )Reports Q3 (Sep) earnings of $1.17 per share, excluding $0.04 benefit, $0.01 better than the Reuters Estimates consensus of $1.16. Co issues guidance for FY07, sees EPS of $4.22-4.25, at the top end of previous guidance range of $4.15-4.25, vs. $4.24 consensus; sees FY07 revs of approx $54.0 bln, compared to previous guidance of $53 bln, vs. $53.29 bln consensus.

NFI Novastar Fin: MSR sales buys time, but diminishes franchise value - FBR (7.70 )
Friedman Billings notes after the close NFI reported the sale of its MSR to Saxon Mortgage Services. Firm est that after the repayment of various debt facilities, NFI will net $10-$15 mln. Given their expectation for dramatically increasing losses and the inability to securitize or sell subprime loans, firm views the proceeds as insufficient to ensure the viability of NFI. While NFI retains the servicing infrastructure, they believe the sale of the MSR eliminates the most attractive aspect of NFI to a potential acquirer.we believe the sale of the MSR underlying the portfolio will negatively impact portfolio performance, as NFI has relinquished control of the servicing decision making process with regard to maximizing values for its subordinate interests.

Morgan Stanley initiates select clean energy stocks
Morgan Stanley initiates select clean energy stocks, the firm upgrades VeraSun Energy (VSE) to Overweight from Equal Weight. The firm also assumes coverage of First Solar (FSLR) with an Overweight and a $175 tgt and assumes EnerNOC (ENOC) with an Underweight. The firm initiates Fuel-Tech (FTEK) tgt $35 and Sunpower (SPWR) tgt $110, with Overweights. Firm also initiates Evergreen Solar (ESLR), Pacific Ethanol (PEIX), Aventine Renewable Energy (AVR), and US BioEnergy (USBE) with Equal Weights. Biofuel Energy (BIOF) is initiated with an Underweight.

RFMD RF Micro Device: Channel checks indicate a better than expected Sept qtr - Jefferies (6.86 ) -Update-
Jefferies raises their FY08 (Mar) ests for RFMD ahead of Q3 results on Oct 23, as they believe the Sept qtr is tracking above the high end of guidance, with seasonal increase across multiple product lines. Firm says the most significant strength is coming through the OEM business from co’s like NOK, and they have detected some minor improvement for MOT.

FTEK Fuel-Tech tgt upped to $39 at ThinkEquity (28.74 )
ThinkEquity raises their FTEK tgt to $39 from $30 following yesterday’s 7.2 mln NOxOUT contract - a high value deal on a single coal-fired boiler. The firm says this confirms their thesis that August is likely a good indicator of FTEK’s outlook over the next few quarters.

YHOO Yahoo!: Color on quarter (26.69 )
Nollenberger notes YHOO reported 3Q rev of $1.28 bln, above consensus of $1.24 bln. GAAP EPS came in at $0.11, ahead of consensus of $0.08, while non-GAAP EPS of $0.17 beat their $0.14 est. While the results were better than expected and will likely drive shares higher today, keep in mind this was not a blowout quarter. Despite the strong 3Q, firm notes YHOO’s Q4 outlook was a bit conservative—signaling either conservatism or a slowdown in the online advertising business. While the acceleration in rev growth was encouraging, firm was disappointed to see margins deteriorate further, down to 23% compared with 25% last quarter and 28% a year ago… Susquehanna notes branded network growth due 1H on the heels of better execution.. Cantor states that while YHOO’s results were better than expected, they also support their views that: i) Yahoo! continues losing sizable share in the online advertising industry; ii) Panama is performing reasonably well, but has not proven a “game-changer”; and iii) recent revitalization efforts, while promising, are very early and not yet driving material business improvements.

AMGN Amgen defends its turf as competition looms for Anemia drug - NY Times (56.78 )
NY Times reports even as the co reels from recent safety questions about its anemia drugs, it is bracing for a possible assault by Roche on its franchise, worth $7 bln a year. It is a war that will be waged not so much with medical studies as with marketing muscle and bare-knuckles pricing tactics intended to capitalize on the rules of Medicare. And because of quirks in those rules, the product with the higher price might have the competitive edge. Roche says it expects the FDA to approve its drug, Mircera, by Nov. 14. If it reaches the market, Mircera will break the monopoly Amgen has had selling anemia treatments to American dialysis centers since the approval of its drug, Epogen, in 1989. Mircera would also compete with Amgen’s newer anemia drug, Aranesp, which now has even bigger sales than Epogen, and with Procrit, a drug sold by Johnson & Johnson under a license from Amgen. According to documents made public in the litigation, both cos have planned for years for their showdown, even conducting “war games” in which some executives acted as the competition to develop pricing strategy.

LLTC Linear Tech: Analog bellwether reports in-line results and outlook - CIBC (34.81 )
CIBC notes analog bellwether LLTC released F1Q results with revs and GAAP EPS were $281.5M (+5% QoQ) and $0.40 vs. Street estimates of $282.0M and $0.38. Firm believes the results bode well for the rest of the analog group. Firm has argued for some time that bellwethers MXIM and LLTC, with margin contraction risk, are unlikely to keep pace fundamentally with smaller and more aggressive competitors. Firm remains positive on 2H prospects for the high performance analog group, as above-seasonal 2Q strength has carried through into 3Q. While lead times remain short, visibility has improved marginally. Firm continues to favor the Tier 2 analog names, including MSCC, MPWR and ISIL.

SHFL Shuffle Master downgraded to Sell at Morgan Joseph- tgt $12 (14.91 )
Morgan Joseph downgrades SHFL to Sell from Hold with a $12 tgt saying based on the January 2008 expiration of a licensing agreement with WMS (WMS) for game content. The firm says this agreement has already been renewed twice by WMS. However they say, the licensing agreement was originally signed in 2001, which was the year WMS disclosed a software glitch that led to delays in product introductions and lost sales. The firm says the licensing agreement made strategic sense in 2001 as WMS was focused on solving the software anomalies and implementing a 3-step technology improvement plan, but it may not make as much sense now.

Pacific Northwest banks maybe be ripe for tie-ups - WSJ
WSJ reports a wave of consolidation may be rolling toward the banking sector in the Pacific Northwest. Stock prices are falling amid general credit-mkt turmoil, slowing construction-loan growth and pressure on interest-rate margins. As a result, the pace of consolidation in the region may pick up from current levels, some analysts say. “Some banks may look at their outlook for 2008 and decide it’s a pretty challenging road ahead and team up with someone else,” said Joe Morford, banking analyst with RBC Capital Markets. “You could see more deal activity; in general, I think you probably will.” Larger banks in the region that analysts said have done acquisitions in the past and may do so in the future include Columbia Banking System (COLB); West Coast Bancorp (WCBO); and Sterling Financial (SLFI). In addition, national banks like Wells Fargo (WFC), Bank of America (BAC)and KeyCorp (KEY) may circle too, given the changes in the mkt so far this year, analysts say. Some potential buyout candidates include Heritage Financial (HBOS) and Cascade Financial (CASB), both cos with strong mkts and limited exposure to construction lending at the moment, D.A. Davidson’s banking analyst Jim Bradshaw said. Riverview Bancorp (RVSB) could also be a candidate, Mr. Bradshaw said.

ADTN ADTRAN: New products well positioned to ramp in 2008 - FBR (24.04 ) -Update-
Friedman Billings notes ADTN’s sales of $124 mln in Q3 were in-line with the preannouncement but EPS of $0.31 beat firm’s $0.28 est and the consensus of $0.29. For Q4, the co expects a sequentially down quarter, in line with the historical trend. Sales of Optical access and NetVanta products hit record levels in 3Q07, offset partially by lower Broadband access sales. The slowdown at two customers [AT&T (T) and Windstream (WIN-$13.80-Not Rated)] caused BB sales to fall short, while sales to others were steady. For 2008, management expects meaningful sales of TA5000 and Opti6100 sales to Tier 1 and Tier 2 customers, and continued momentum in the Internetworking (NetVanta) busines

INTC Intel: Color on quarter (25.48 )
Broadpoint Capital notes INTC reported Q3 EPS of $0.31 on rev of $10.1 bln, slightly above firm’s ests of $0.30 on rev of $9.73 bln and the consensus of $0.30 on $9.62 bln, respectively. For 4Q07 EPS firm is raising their EPS est to $0.41 on rev of $11.0 bln from $0.37 on $10.5 bln, respectively. For CY07, they now est EPS of $1.21 on rev of $38.6 bln, up from $1.16 on $37.8 bln, respectively. For CY08, firm is raising their EPS est to $1.70 on rev of $44.1 bln from $1.45 on $41.7 bln, respectively. Firm raises tgt to $34 from $29… Nollenberger reiterates their Buy rating on INTC’s shares following solid 3Q results and healthy but reasonable 4Q sales and margin guidance. In particular, it appears that INTC is firing on all cylinders with 1) continued rev growth and margin expansion coupled with 2) a strong product portfolio resulting in healthy sell through and 3) lean inventories, as 45nm chips make their way through the manufacturing pipeline. Firm is hopeful that notebook continues its strength throughout 4Q and believe the upcoming 45nm server launch (Harpertown) on Nov 12 is additive and will further enhance profits and margins in the coming quarters… Jefferies is raising their FQ4 ests on INTC to $10.806 bln/$0.41 from $10.317 bln/$0.36. Firm’s FY08 ests go up to $42.309 bln/$1.55 from $40.72 bln/$1.38. They are also raising their tgt to $31 from $29 to reflect INTC’s improving profitability.

CFC Countrywide: Color on yesterday’s restructuring charge (18.09 ) -Update-
Wachovia notes that CFC disclosed more details about the previously announced restructuring the co was undertaking in response to falling mortgage origination volumes and difficult secondary mortgage market conditions. The firm is not changing their earnings estimates due to these restructuring charges, as their EPS estimates reflect recurring earnings only. However, they are reducing their 2007 and 2008 book value estimatesto $24.27 and $25.89 from $24.43 and $26.05, respectively.

Upgrades: Piper Jaffray upgrades Sonus Networks (SONS 6.26) to Outperform from Market Perform…. RBC upgrades Five Star (FVE 8.7 to Outperform from Market Perform. Downgrades: Oppenheimer downgrades Quintana Maritime (QMAR 27.64) to Sell from Neutral saying they believe yesterday’s closing price of $27.64 implies a 13.3% and 20.2% premium to the co’s theoretical take-out value of $24.4/share and the fair value of QMAR’s shares on an ongoing basis, respectively. The firm says they are hesitant to call for significant multiple expansion in names where meaningful earnings acceleration is unlikely to occur before 2Q08 when 2008 iron ore prices will likely go into effect… Thomas Weisel downgrades Biogen (BIIB 79.29) to Market Weight from Overweight… Thomas Weisel downgrades Occam Networks (OCNW 6.29) to Market Weight from Overweight. Miscellaneous: Lehman initiates Hologic (HOLX 67.51) with an Overweight and a $75 tgt… Morgan Stanley resumes coverage BCE Inc (BCE 41.4 with an Equal Weight… Pacific Growth initiates Sangamo Biosciences (SGMO 15.55) with a Buy… Thomas Weisel initiates Comverge (COMV 35.12) with a Market Weight… Thomas Weisel initiates EnerNoc (ENOC 47.75) with an Overweight… Thomas Weisel initiates PowerSecure (POWR 11.60) with a Market Weight… Wachovia initiates Conn’s (CONN 26.42) with a Market Perform saying with only 63 stores currently in operation in two states they believe significant growth opportunities remain ahead.

MAN Manpower beats by $0.20, beats on revs; guides Q4 EPS above consensus (69.31 )
Reports Q3 (Sep) earnings of $1.57 per share, $0.20 better than the Reuters Estimates consensus of $1.37; revenues rose 15.4% year/year to $5.3 bln vs the $5.22 bln consensus. Co issues upside guidance for Q4, sees EPS of $1.50-1.54 vs. $1.45 consensus. Co said, “Although we do detect a bit of caution in the markets, as we look to the fourth quarter, we do not believe it will significantly affect our performance.”

MDT Medtronic and FDA face scrutiny on safety issues - WSJ (50.30 )
WSJ reports the co’s decision to stop selling potentially defective defibrillator leads has prompted scrutiny of the devices and of how safety concerns about them were handled by the company and the FDA. Plaintiffs attorneys, a consumer group and Iowa Sen. Chuck Grassley are examining the history of the Sprint Fidelis leads, which are electrical wires that connect the hearts of patients to the defibrillators implanted in their chests. In early signs of the pressure likely to come for Medtronic and the FDA, Mr. Grassley last night sent letters to the co and the agency asking for more information about the leads. Separately, consumer group Public Citizen argued in a letter that the co and agency should have taken action sooner. In addition, a group of plaintiffs attorneys, which has been a leader in major heart-device lawsuits, filed suits against Medtronic related to the Sprint Fidelis leads in federal court in Minneapolis and Puerto Rico, according to Hunter Shkolnik, one of the lawyers.

Mortgage Applications
The weekly MBA mortgage applications index rose 0.7% last week, with purchasing applications up by 2.1% & refis lower by 1.1%. The fixed 30-yr mortgage rate was flat at 6.40% while the 15-yr climbed to 6.09% & 1-yr adjustable rate mortgage edged up to 6.17%.

MTG MGIC Investment reports Q3 (Sep) results, beats on revs (30.87 )
Reports Q3 (Sep) loss of $3.74 per share, includes charges, does not compare to the Reuters Estimates consensus of $0.36; revenues rose 50.4% year/year to $555.4 mln vs the $400.1 mln consensus.Co said that the dislocation of the mortgage finance and housing markets had a material impact on the company’s financial results in the third quarter. Co expects these market conditions to continue to have an impact on its financial results through 2008. The company is providing the following guidance for the remainder of 2007 and the full year 2008: 2007 fourth quarter paid losses approximating $270-290 mln; 2008 paid losses approximating $1.2-1.5 bln; 2008 insurance in force growth approximating 8-10%; 2008 total mortgage originations approximating $1.8-2.0 tln with flow mortgage insurance penetration approximating 16-17%; 2008 new insurance written approximating $60-64 bln

Foods cos face US probe over Iraq deals - WSJ
WSJ reports prominent American food cos are under scrutiny in a federal probe of possible fraud and corruption in the military’s food-supply operations for the Iraq war. Investigators from the Justice Department and the Defense Department are looking into deals that Perdue Farms, Sara Lee (SLE), ConAgra Foods (CAG) and other U.S. cos made to supply the military, according to people involved in the inquiry. The cos made the deals with the help of former U.S. military procurement officials they hired as consultants or executives. The inquiry is focused on whether the food cos set excessively high prices when they sold their goods to the Army’s primary food contractor for the war zone, a Kuwaiti co called Public Warehousing. A related question is whether Public Warehousing improperly pocketed for itself refunds it received from these suppliers. Public Warehousing bought vast amounts of meat, vegetables and bakery items from the food companies, and delivered them to U.S. troops.

Upgrades: Jefferies upgrades Gentiva Health (GTIV 17.53) to Buy from Hold and raises their tgt to $22 from $20.50 saying the recent sell-off in GTIV shares is overdone. The firm also says given GTIV’s significant L.T growth prospects and its attractive valuation they believe GTIV should be bought at current price levels… Jefferies upgrades Lincare Holdings (LNCR 33.00) to Buy from Hold and raises their tgt to $40 from $37 given current prices, they believe LNCR’s stock adequately reflects the likelihood that Congress could severely cut Medicare oxygen reimbursement this year. The firm believes that the time to start accumulating LNCR is now. Downgrades: Friedman Billings downgrades Robbins & Myers (RBN 72.14) to Market Perform from Outperform and raises their tgt to $66 from $60 following F4Q07 EPS results that were higher than they expected. The firm says given current trading levels, they are downgrading RBN shares… Lehman downgrades LM Ericsson (ERIC 31.33) to Equal Weight from Overweight… Merrill downgrades Equity Lifestyle (ELS 51.87) to Neutral from Buy… Oppenheimer downgrades Seacoast Banking (SBCF 16.00) to Neutral from Buy following the co’s preannouncement. The firm notes the co SBCF preannounced that it will boost reserves significantly in 3Q07 and that NPAs are expected to jump significantly related to credit deterioration of the residential development loan portfolio… Oppenheimer downgrades ValueClick (VCLK 24.55) to Neutral from Buy and cut their tgt to $27 from $30 noting the co preannounced and lowered its prior guidance for revenue for 3Q and revenue and EBITDA for 2007

More cos behind banks’ credit rescue fund - WSJ
WSJ reports a planned king-size investment pool to acquire mortgage assets and bolster sputtering credit mkts is gaining participants, despite hesitation from some banks and securities cos about joining the effort. Yesterday, Wachovia (WB) said it will participate in the fund. “While it’s not a significant issue for us, we plan to participate at an appropriate level because we want to help improve the stability of the markets,” a spokeswoman said. Among the cos offering support for the plan are Fidelity Investments and Federated Investors. Both hold debt issued by an arm of Gordian Knot, one of the SIVs that could benefit from the fund. Some other financial-services cos said they plan to steer clear. Rick Waddell, the new CEO of Northern Trust (NTRS), said in an interview yesterday his co has no interest in participating in the superfund as lender or investor, particularly since it has no exposure to the kind of investment vehicles that hold the mortgage securities in question. Mr. Waddell also described the creation of the fund as an aid to Citigroup (C), which has the greatest exposure of any bank to such structured investment vehicles. “It really is J.P. Morgan and Bank of America helping out Citibank,” he said. Four Wall Street cos, Goldman Sachs Group (GS), Merrill Lynch (MER), Lehman Brothers (LEH) and Bear Stearns (BSC), all participated in the exploratory talks about the plan, according to participants, but haven’t yet indicated they would join. Morgan Stanley (MS) is studying the plan, one person on Wall Street said. European banks such as HSBC (HBC), Barclays (BCS), Deutsche Bank (DB), UBS (UBS) and Credit Suisse (CS) are hanging back, according to people on Wall Street.

Virgin has Rock ‘building society’ plan - FT
FT reports Virgin plans to make Northern Rock “much more like a building society” and cut back its lending business if the consortium led by Sir Richard Branson wins control of the troubled lender. Jayne-Anne Gadhia, the Virgin Money chief executive who would take charge of Northern Rock if the bid was successful, told the Financial Times she would rebuild Northern Rock’s deposit base by expanding its range of online savings accounts and improving the profitability of its mortgage book. This would make Northern Rock less dependent on funding from the wholesale mkts. “Our plan doesn’t try to grow mortgage assets, it attempts to grow mortgage margin,” she said. Ms Gadhia added that Virgin would aim to keep most of Northern Rock’s staff, but that the “vast majority” of its executive team would have to be replaced.

UTX United Tech beats by $0.01, beats on revs; guides FY07 EPS at top end of previous guidance, revs above consensus (79.65 )Reports Q3 (Sep) earnings of $1.17 per share, excluding $0.04 benefit, $0.01 better than the Reuters Estimates consensus of $1.16. Co issues guidance for FY07, sees EPS of $4.22-4.25, at the top end of previous guidance range of $4.15-4.25, vs. $4.24 consensus; sees FY07 revs of approx $54.0 bln, compared to previous guidance of $53 bln, vs. $53.29 bln consensus.

JPM JP Morgan Chase beats by $0.01, misses on revs (45.11 )
Reports Q3 (Sep) earnings of $0.92 per share, $0.01 better than the Reuters Estimates consensus of $0.91; revenues rose 3.6% year/year to $16.11 bln vs the $16.71 bln consensus. Net income was $296 million, down by $680 million, or 70%, compared with the prior year. The decrease in earnings reflected lower net revenue as well as a higher provision for credit losses, partially offset by lower noninterest expense. Co said, “Asset Management and Treasury & Securities Services delivered record earnings, Card Services and Commercial Banking produced double-digit earnings growth, and Private Equity posted another quarter of strong gains. Investment banking is a volatile business, and while we would typically expect lower earnings in the Investment Bank during a difficult market environment, such as this one, we still believe that our performance could have been a bit better. Finally, Retail Financial Services had good revenue growth while further strengthening its reserves for home equity loan losses.” Co also sated, “We remain cautious about the future economic environment, but will continue to make investments based upon the long-term outlook for market and client volumes.”

RDEN Elizabeth Arden profiled in New America section of IBD (27.91 )
IBD reports the co has a lot riding on its famous faces. In 2007, 20% of its sales have come from its celebrity fragrance lines. For the full year, sales gained 18% to $1.13 bln. Earnings climbed 5% to $1.21 a share. The results look so good in part because fiscal 2006 was a lousy year for Arden. Many department stores closed after Federated Department Stores, now Macy’s, (M) merged with May. “We believe Arden will display meaningful year-over-year earnings growth over the next few quarters, due partly to easy comparisons versus a year ago, when the initial impact of the Sovereign acquisition was quite dilutive to earnings,” Wedbush Morgan Securities analyst Rommel Dionisio wrote in a note to investors. Allan Mottus, a longtime industry consultant and editor of MottusBeauty.com, says real brains behind the business is CEO E. Scott Beatty. “He’s very nimble and very good at picking up on trends and very entrepreneurial and acquisitive for a finance guy,” he said. “They’re not heavy on staff and overhead, so they can make a decision, exploit it and if it isn’t successful, move on. A lot of other companies can’t keep up with Arden.” Analysts polled by Thomson Financial expect Arden to see a healthy 39% gain in fiscal 2008 profit, to $1.68 a share. Analysts also forecast growth of about 20% each of the next two years.

BLK BlackRock beats by $0.38, beats on revs (184.19 )
Reports Q3 (Sep) adjusted earnings of $2.29 per share, excluding non-recurring items, $0.38 better than the Reuters Estimates consensus of $1.91; revenues rose 301.8% year/year to $1.3 bln vs the $1.17 bln consensus. “The third quarter featured widespread reassessment of valuations in the credit markets, which led to a significant reduction in liquidity and greater market uncertainty, which in turn caused investors to flock to safe havens,” commented Laurence D. Fink, Chairman and CEO of BlackRock. “The sharp influx in money market funds was coupled with a slowdown in long-dated searches and fundings. We were able to take advantage of our well-diversified product range in offering clients strategies appropriate to the environment. We expect the current shift in investor preferences to be temporary, as investors adjust to the change in market conditions. We do not, however, expect the market dislocations to be easily or quickly resolved, and we remain vigilant in applying the full range of our capabilities on behalf of our asset management and BlackRock Solutions’ clients.”

PJC Piper Jaffray misses on top and bottom line (52.33 )
Reports Q3 (Sep) earnings of $0.28 per share, excluding non-recurring items, $0.28 worse than the Reuters Estimates consensus of $0.56; revenues fell 24.2% year/year to $92.9 mln vs the $117.6 mln consensus. The declines were primarily attributable to significantly lower investment banking revenues. “The turmoil in the credit markets created very challenging capital markets conditions in the third quarter. While our business is not focused on the most troubled aspects of the credit markets, namely subprime mortgages and LBO loan commitments, the fallout from the turbulence in these markets negatively impacted nearly all of our businesses… We believe the adverse conditions were largely concentrated in the third quarter. Our current deal pipelines are strong, and we believe that going forward, the environment will be more conducive to capital markets activity. In addition, despite the recent difficult conditions we continued to execute our growth strategy. We successfully closed our acquisitions of FAMCO and Goldbond, both of which will serve to broaden our capabilities and diversify our revenue base.”

APH Amphenol beats by $0.04, beats on revs; guides Q4 EPS above consensus, revs above consensus (39.77 )
Reports Q3 (Sep) earnings of $0.50 per share, $0.04 better than the Reuters Estimates consensus of $0.46; revenues rose 15.3% year/year to $733.9 mln vs the $692.4 mln consensus. Co issues upside guidance for Q4, sees EPS of $0.50-0.52 vs. $0.49 consensus; sees Q4 revs of $740-755 mln vs. $712.88 mln consensus.

ITW Illinois Tool beats by $0.01, reports revs in-line; guides Q4 EPS in-line (58.61 )
Reports Q3 (Sep) earnings of $0.89 per share, $0.01 better than the Reuters Estimates consensus of $0.88; revenues rose 15.7% year/year to $4.09 bln vs the $4.12 bln consensus. Co issues in-line guidance for Q4, sees EPS of $0.86-0.90 vs. $0.89 consensus; co sees Q4 total co base revs to grow 2.1-4.1

CHL China Mobile tgt raised to $115 from $66 at Pali (90.00 )
Pali raises their tgt to $115 from $66, based on higher subscriber growth and ARPU estimates. Firm says their higher subscriber and ARPU estimates materially lifted their rev growth estimate to nearly 25% in 2008 and 2009, and they believe EBITDA margins can remain in the mid 50’s or even expand vs a consensus expectation of a contraction. Firm says this compares favorably to other large wireless operators around the globe like America Movil (AMX) or Verizon (VZ), which they expect to grow service rev at less than half that rate or Sprint (S) which appears to be in a state of steady rev decline. Firm has increased their mkt share estimates for CHL to reflect their view that there is likely to be no new competitor in China or change in regulations for the foreseeable future.

WFC Wells Fargo downgraded to Hold at Stifel (34.55 ) -Update-
Stifel downgrades WFC to Hold from Buy following earnings. The firm says the primary reasons for the downgrade include: 1) significantly lower than expected net interest income growth, which they previously viewed as being the offset to higher loan losses and lower mortgage origination and gain on sale income, 2) management’s expectation of higher net charge-offs from the home equity loan portfolio and their concern that the issue could migrate from a severity issue (currently) to both a frequency and severity issue.