The Altria board, as expected, announced the spinoff of its Philip Morris International division. Precise timing of the spinoff will be announced at its regularly meeting on January 30, 2008. Also, as expected, voted to increase the dividend 8.7% to $0.75. The stock is still up, but off its highs; no statement on increased buyback, or cost reduction efforts.
The idea here is sound: separate PMI from its U.S. twin, which is burdened with high taxes and legal issues.
And Dillards , the worst performer at the NYSE, is down 10%. Dillard's reported earnings well below expectations.Well below? How about WAY below. Street expecting a loss of $0.01; they reported a loss of $0.31. Dillards offered almost no explanation for the amazing miss. They blamed lackluster sales that necessitated higher markdowns.
Even analysts, like M. Exstein at Credit Suisse, were mildly indignant: "While the company's standard operating procedure is to not provide any detail on the quarter or any other communication, this time should have been different. With operating results this weak, management owes its shareholders an explanation and a guideline of what steps are being taken. Instead, there is the typical silence leaving investors in the dark."
And when was the last time you heard of disk drive companies RAISING prices? Seagate is up 5%, raised its guidance, citing stronger than expected demand and higher prices. Seagate cited a more balanced supply and demand environment which helped drive better demand and pricing overall. The company also said it was not for sale, despite reports that some Asian companies might be interested.
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