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Stocks to Watch, Aug. 31: OmniVision, Home Depot

Among the companies whose shares are expected to see active trading in Friday's session are Dell Inc., OmniVision Technologies Inc., and Home Depot Inc.

After Thursday's closing bell, Dell (DELL) reported a 46 percent gain in second-quarter earnings, which the world's No. 2 computer company credited to strong sales of computer servers and notebook PCs.

Also, Home Depot (HD) said it's closed its sale of HD Supply to three private-equity firms for about $8.5 billion, nearly $2 billion below the original offer for the unit. In June, Home Depot announced that it had agreed to sell its supply business to Bain Capital, Carlyle Group and Clayton Dubilier & Rice for $10.3 billion. Under the revised terms announced earlier this week, Atlanta-based Home Depot will pay $325 million for a 12.5 percent equity interest in HD Supply and guarantee a $1 billion senior secured loan of HD Supply.

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Chevron Corp. (CVX) said its subsidiaries, Chevron U.S.A. Inc. and Chevron Credit Bank N.A., have agreed to sell their respective proprietary credit-card businesses. Financial terms weren't disclosed. San Ramon, Calif.-based Chevron said it has selected GE Money Bank N.A. to own and operate its Chevron- and Texaco-branded consumer credit cards, and FleetCor Technologies Operating Co. to own and operate its branded commercial credit cards. The transactions are subject to certain approvals, including regulatory, and are expected to close later this year, Chevron said.

Cost Plus Inc. (CPWM) reported its second-quarter net loss widened to $18 million, or 81 cents a share, from $14.2 million, or 64 cents a share, in the year-ago period. The Oakland, Calif.-based home furnishings retailer said revenue fell slightly to $215.2 million from $215.3 million. Analysts polled by Thomson Financial were expecting, on average, a per-share loss of 65 cents on revenue of $217 million. Same-store sales for fell 7.6 percent during the quarter, the company said. For the third quarter, Cost Plus said it expects a per-share loss of 73 cents to 80 cents on revenue of $217 million to $223 million, and a same-store sales decrease of 3 percent to 6 percent. The company also said it has named Jane Baughman as chief financial officer, succeeding Thomas Willardson.

Credence Systems Corp. (CMOS) reported it swung to a fiscal third-quarter net profit of $10.3 million, or 9 cents a share, from a net loss of $461.4 million, or $4.61 cents a share, in the year-ago period. The Milpitas, Calif.-based maker of semiconductor test equipment said revenue rose to $123.5 million from $114.5 million. Analysts polled by Thomson Financial were expecting, on average, a per-share profit of 5 cents on revenue of $123 million. Additionally, Credence said it expects fourth-quarter per-share results of about breakeven on revenue of $101 million to $105 million.

Delia's Inc.'s (DLIA) fiscal second-quarter loss widened to $5.09 million, or 16 cents a share, from a year-earlier loss of $3.13 million, or 12 cents a share. The number of average outstanding shares increased to 30.8 million from 26.4 million a year earlier. The New York retailer said for the quarter ended Aug. 4, revenue rose 7.3 percent to $52.4 million from $48.9 million as same-store sales for its retail segment rose 4.6 percent. On average, analysts polled by Thomson Financial expected a loss of 12 cents a share on revenue of $54 million.

Esterline Technologies Corp.'s (ESL) fiscal third-quarter earnings jumped to $38.8 million, or $1.49 a share, from $11.2 million, or 43 cents a share, a year earlier. The company noted its earnings for the most recent period included a $23 million, or 88 cents a share, benefit from a previously disclosed insurance recovery. Excluding this item, earnings were 61 cents a share. The Bellevue, Wash., aerospace supplier's sales increased to $326.4 million from $248.4 million. Wall Street analysts, on average, expected second-quarter earnings of 55 cents a share and sales of $324 million, according to a survey by Thomson Financial. The company raised its full-year operating earnings guidance to a range of $2.55 to $2.65 a share, up from previous guidance of $2.50 to $2.60 a share.

Gottschalks Inc. (GOT) said it swung to a fiscal second-quarter loss and that the company has concluded its review of strategic alternatives. The Fresno, Calif., department store chain posted a loss of $4.77 million, or 35 cents a share, from a year-earlier profit of $486,000, or 4 cents a share. Net sales for the quarter ended Aug. 4 fell 4.8 percent to $145 million from $152.8 million as same-store sales declined 4 percent. Gottschalks concluded that focusing on independent strategic growth initiatives offers a better long-term value for the company and shareholders than other proposed alternatives. The company signed a commitment letter for an amended five-year, $200 million financing agreement with GE Commercial Finance Corporate lending to support the initiatives.

ITT Corp. (ITT) will tackle the first part of upgrading the nation's stretched and aging air-traffic control system under a newly awarded contract worth up to $1.8 billion, said the Federal Aviation Administration. ITT and its team, which includes phone giant AT&T Inc. (T) , edged out Lockheed Martin Corp. (LMT) and Raytheon Co. (RTN) for the 18-year contract. In a statement, ITT said its portion of the initial, three-year contract was worth $207 million.

Jamba Inc.'s (JMBA) fiscal second-quarter net income plunged to $2.33 million, or 4 cents a share, from $31.1 million, or $1.09 a share, a year earlier as operating expenses soared on the opening of 27 stores. The San Francisco-based operator of the Jamba Juice chain said revenue for the quarter ended July 24 increased 14 percent to $89.6 million from $78.5 million a year ago. Analysts polled by Thomson Financial, on average, predicted second-quarter earnings of a penny a share and revenue of $87.2 million.

Longs Drug Stores Corp.'s (LDG) August same-store sales, or sales at stores open at least one year, rose 2.2 percent. Total retail drug store sales from continuing operations for the four-week period ended Aug. 23 rose 3.4 percent to $360 million, from $348 million a year earlier, the Walnut Creek, Calif.-based drugstore chain said.

Chip-equipment maker Novellus Systems Inc. (NVLS) widened its order book forecast amid uncertainty from key customers in South Korea. Novellus said third-quarter orders for new equipment to make microchips in PCs and other consumer electronics would be in the range of $299 million to $349 million, compared with its prior forecast of $316 million to $349 million. The San Jose, Calif.-based chip-machine provider reiterated its prior targets for revenue, shipments, gross margin and earnings per share. Chief Executive Officer Rick Hill said there is some uncertainty about the spending habits of U.S. consumers due to problems in the U.S. housing and credit markets. Top customers of Novellus include Intel Corp. (INTC) , Samsung Electronics Co., and Hynix Semiconductor.

OmniVision Technologies' (OVTI) fiscal first-quarter net income fell to $13 million, or 23 cents a share, from $15.9 million, or 28 cents a share, a year earlier. Results from the most recent period include a $4.5 million tax benefit, offset by stock-based compensation expenses and related tax charges. Excluding those items, net income for the Sunnyvale, Calif., designer of image sensors was $19.7 million, or 35 cents a share. Non-GAAP net income was $22.1 million, or 39 cents a share, a year earlier. The company's revenue rose 26 percent to $173.1 million in the period ended July 31 from $136.9 million in the year-ago period, boosted by increased revenue from the PC notebook market. On average, analysts polled by Thomson Financial expected per-share earnings of 18 cents on revenue of $160 million.

Popular Inc. (BPOP) said it has agreed to acquire the operations of broker-dealer Smith Barney in Puerto Rico. Financial terms of the deal were not disclosed. Smith Barney is a division of Citigroup Global Markets Inc. As of June 30, Smith Barney's securities business in Puerto Rico consisted of roughly $1.8 billion in assets under management, 15,000 accounts and 42 employees. Popular is based in San Juan, P.R.

Restoration Hardware Inc. (RSTO) reported that it swung to a second-quarter net loss of $7.92 million, or 20 cents a share, from a year-ago net profit of $236,000, or a penny a share. The Corte Madera, Calif.-based home furnishings and home products retailer said revenue in the three months ended Aug. 4 rose to $183.8 million from $179.3 million. Analysts polled by Thomson Financial were expecting, on average, a per-share loss of 20 cents on revenue of $184 million. "While we are planning for improvement in our operating performance in the second half of the year, we believe a cautious outlook is appropriate given the macro economic pressures impacting our sector," said Gary Friedman, president and chief executive, in a statement. The company forecast a third-quarter loss of 19 cents to 25 cents a share on revenue of $183 million to $188 million. Analysts are looking for a per-share loss of 13 cents on revenue of $171 million. For 2007, Restoration Hardware forecast a loss of 14 cents to 21 cents a share on revenue of $754 million to $764 million. Analysts expect a loss of 18 cents a share on revenue of $762 million.

Silicon Graphics Inc. (SGIC) reported a fiscal fourth-quarter net loss of $36.9 million, or $3.32 a share, versus a year-ago net loss of $20.4 million, or 8 cents a share. The company posted an operating loss of $24.8 million versus $8.25 million last year. The Sunnyvale, Calif.-based maker of servers and storage products said revenue in the three months ended June 29 rose 6 percent to $122.3 million from $115.7 million.

Wind River System Inc.'s (WIND) fiscal second-quarter net income rose 38 percent to $4.31 million, or 5 cents a share, from $3.13 million, or 4 cents a share, a year earlier on early returns on product and other investments. Excluding items, earnings were $10.5 million, or 12 cents a share. The Alameda, Calif., device software optimization company's revenue for the quarter ended July 31 increased 15 percent to $84.6 million from $73.7 million a year ago. Analysts polled by Thomson Financial, on average, predicted second-quarter revenue of $78.7 million. Wind River expects a third-quarter loss of 6 cents to 7 cents a share and revenue of $78 million to $80 million. Excluding items, the company expects earnings of 3 cents to 4 cents. Analysts predict third-quarter revenue of $82.9 million.



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