Russell 2000 lower, Dow higher
The Russell 2000 lost big today, while the Dow managed a small rise. Among specific small cap stocks, QAD Inc. (Nasdaq: QADI) said it expects to report a loss in the first quarter of fiscal 2008, while shares of Source Interlink Companies, Inc. (Nasdaq: SORC) sagged on news of a $1.2 billion media acquisition.
The Russell 2000 lost 7.21 points, or 0.87%, to 822.33. The Dow Jones Industrial Average added 20.56 points, or 0.15%, to 13,346.78.
Shares of enterprise applications provider QAD Inc. depreciated following news the Carpinteria, Calif.-based company expects a net loss in the first quarter of fiscal 2008. According to preliminary estimates, QAD projects a net loss of between $0.05 per share and $0.07 per share for the quarter ended April 30, the company said after Friday’s close. Revenue is forecast at $56 million. The previous projections called for net income of between $0.01 per share and $0.03 per share. Analysts are looking for earnings of $0.05 on revenue of $59.48 million. QAD attributed the revenue and earnings shortfall in part to lower than expected license revenues in the first quarter of 2008 due to sales management changes in the North America region. Shares loss $1.47, or 16%, to $7.90.
Asset management company Lazard Capital initiated its coverage of San Diego-based La Jolla Pharmaceutical Company (Nasdaq: LJPC) with a buy rating. According to news reports after the market open, the target price has been set at $9. Shares added $0.18, or 3%, to close at $5.49.
Shares of Bonita Springs, Fla.-based Source Interlink Companies, Inc. ended the day among the losers following news the entertainment products marketing company has bought PRIMEDIA Inc.’s (NYSE: PRM) Enthusiast Media segment for $1.2 billion. The all-cash transaction combines EM’s industry-leading magazine content portfolio, containing over 70 magazine titles and 90 Web sites, with Source Interlink's premier magazine distribution and merchandising platform, the company said after the opening bell. The deal is expected to close in the summer. Shares lost $1.81, or 15%, to close at $5.79.
The news that most preoccupied investors’ mind today was the announcement that DaimlerChrysler (NYSE: DCX) has sold 80.1% of its stake in Chrysler to private equity group Cerberus Capital Management for $7.45 billion. It has long been rumored that the German automaker is looking to offload its troubled counterpart.
