Stocks in the News: Goldman Sachs, Hasbro, Eli Lilly
Goldman Sachs Group Inc. (GS) sank nearly 13% on Friday after the Securities and Exchange Commission charged the firm with fraud on subprime mortgages.The SEC said Goldman defrauded investors by failing to disclose conflicts in a 2007 sale of collateralized debt obligation. Investors in the CDO ultimately lost $1 billion, the SEC said. Goldman Sachs is reporting first-quarter earnings Tuesday. Shares fell more than 1% in premarket trades.
Eli Lilly & Co. (LLY) reported Monday that despite a 9% revenue increase, its profit fell 5% in its first quarter because of charges tied to health reform and increased spending on research, development and marketing. Eli Lilly also reduced its full-year profit outlook due to health overhaul related charges. Excluding charges, Lilly beat bottom line estimates, although missed on the top. Shares dropped some 1.5% ahead of the bell.
Halliburton (HAL) reported first-quarter profit slumped nearly 46% as revenue fell 4%, with the industry still reeling from last year's drop in oil drilling and a charge related to the recent devaluation of Venezuela's currency. Excluding the charge, earnings exceeded estimates. Shares declined 1.6% before the bell.
Hasbro's (HAS) first quarter profit nearly tripled thanks to higher revenue in all major product categories and a tax benefit. Hasbro is also starting a $625 million share repurchase program. The toymaker handily beat earnings and revenue forecasts. Shares jumped 2.7% in premarket trading.
Delta Air Lines (DAL), Continental Airlines (CAL), US Airways (LCC), American Airlines' parent (AMR) and United Airlines (UAUA) are all expected to post losses when they begin reporting starting Tuesday. One-time costs for February snowstorms and substantially higher fuel prices weighed down results, but the industry is on track to return to profit. Meanwhile, the airline industry is urging Europe to reopen airports.
Citigroup (C), which was expected to barely break even, reported a surprise first-quarter profit of $4.4 billion as trading revenue offset losses from failed loans. Citigroup earned 15 cents per share on revenue of $25.4 billion. Immediately following the results, shares gained in premarket trades, but have since turned a corner and have been falling.
IBM (IBM) is expected to report earnings of $1.93 per share on $22.8 billion in revenue when it reports first quarter results after the close Monday.
Toyota Motor Corp. (TM) is expected to agree to pay a fine of $16.4 million for failing to promptly report to the government problems with sticking gas pedals on its vehicles, a Transportation Department official said.