Stocks to Watch: PepsiCo; Safeway; Men's Wearhouse

SAN FRANCISCO – Among the companies whose shares are likely to see active trading during Thursday's session are PepsiCo Inc., Safeway Inc., and Men's Wearhouse Inc.

Fastenal Co. (FAST) is expected by analysts surveyed by Thomson Financial to report earnings of 42 cents a share for the third quarter.

Herley Industries Inc. (HRLY) is forecast to post fiscal fourth-quarter earnings of 27 cents as share.

M&T Bank Corp. (MTB) is expected to report third-quarter earnings of $1.93 a share.

Analysts expect PepsiCo Inc. (PEP) to post third-quarter earnings of 96 cents a share.

Safeway Inc. (SWY) is expected to report earnings of 44 cents a share in the third quarter.

SLM Corp. (SLM) is expected to report third-quarter earnings of 74 cents a share.

Winnebago Industries Inc. (WGO) is forecast to report fiscal fourth-quarter earnings of 41 cents a share.

After Wednesday's closing bell, Lam Research Corp. (LRCX) reported a 2 percent rise in operating income for its first fiscal quarter amid better-than-expected revenue. The chip-equipment maker said operating income was $197.9 million on revenue of $684.6 million. Lam disclosed limited earnings information due to an ongoing internal review of the way it granted employee stock options.

Watch List

Alcoa Inc. (AA) said its efforts to divest less profitable business lines may result in "severance and other exit costs" beyond the third-quarter charges it disclosed in its earnings release late Tuesday.

Ambac Financial Group Inc. (ABK) expects a net loss of up to $3.50 a share in the third quarter from an unrealized loss on its credit derivative contracts. After a "mark-to-market" adjustment, the company sees a $743 million loss in its credit derivative portfolio. The company expects operating earnings of $1.85 to $1.90 a share in the quarter. Analysts estimated earnings of $1.99 a share.

Apogee Enterprises Inc. (APOG) said its board raised the quarterly dividend 10 percent to 7.4 cents from 6.75 cents. The dividend is payable Nov. 14 to shareholders of record as of Oct. 30.

American Eagle Outfitters Inc. (AEO) September same-store sales fell 2 percent because of lower store traffic, and cut its outlook for the third quarter. Analysts had expected the same-store sales to rise 1.2 percent. The company also reduced its earnings outlook range for the third quarter to 44 cents to 45 cents a share, compared with its previous 47 cents to 48 cents a share range.

Community Health Systems Inc. (CYH) agreed to buy nearly all the assets of Spokane, Wash.-based Empire Health Services. The assets include two hospitals and other outpatient and ancillary services. Financial terms were not disclosed. Community Health expects the deal to close in the first quarter of 2008.

C. R. Bard Inc. (BCR) approved the repurchase of up to $500 million in stock. Repurchases will be made in the open market or through privately negotiated transactions. The decision follows the nearly completed buyback of $500 million of stock, authorized by the board in December 2005.

Forward Air Corp. (FWRD) lowered its third-quarter earnings outlook to a range of 35 cents to 37 cents a share, citing the negative effects of a "sluggish economy" on its airport-to-airport network. Analysts expect per-share earnings of 42 cents.

Health Net Inc. (HNT) named Joseph Capezza as the new chief financial officer. Capezza will assume the position on Nov. 1.

Hot Topic Inc.'s (HOTT) September same-store sales fell 2.9 percent. Analysts expected comparable store sales to fall 4 percent. Total sales for the five-week period ended Oct. 6 were down 6.9 percent to $59.3 million, the City of Industry, Calif., mall-based specialty retailer said.

General Motors Corp. (GM) said employees represented by the United Auto Workers union ratified a new four-year contract. The agreement covers about 74,000 GM employees in more than 80 U.S. plants. The company and the union reached a tentative agreement on the contract on Sept. 26.

Medtronic Inc. (MDT) said a Food and Drug Administration advisory panel unanimously recommended the agency approve the company's Endeavor drug-coated stent for coronary artery disease. The FDA is not bound by panel recommendations but often follows them.

Men's Wearhouse Inc. (MW) cut its third-quarter earnings outlook to a range of 66 cents to 70 cents a share from a prior expectation for earnings of 70 cents to 73 cents a share. The Houston retailer cut its outlook as same-store K&G sales were weaker than planned and the process of integrating After Hours stores resulted in lower tuxedo rental volume. Wall Street was looking for earnings of 73 cents a share.

Peabody Energy Corp.'s (BTU) board approved a spinoff of coal assets and operations in West Virginia and Kentucky to shareholders. The spinoff will be done through a special dividend of outstanding shares of Patriot Coal Corp., which would then be traded on the New York Stock Exchange under the ticker symbol "PCX." Earlier Wednesday, Peabody Energy said it named Gregory Boyce chairman, in addition to his duties as president and chief executive

Ruby Tuesday Inc.'s (RT) fiscal first-quarter net income fell to $11.1 million, or 21 cents a share, from $21.6 million, or 37 cents a share, a year earlier. Earnings for the most recent period include 5 cents a share in costs associated with the company's remodeling initiative. Revenue rose 2.4 percent to $346.8 million. Analysts expected a profit of 22 cents a share and revenue of $345.3 million. Ruby Tuesday cut its second-quarter profit outlook to a range of a penny to 3 cents a share, including costs of 5 cents to 7 cents from its remodeling initiative and a same-restaurant sales decrease of 6 percent to 8 percent.

Spirit AeroSystems Inc. (SPR), a maker of aircraft wings and fuselages, said Boeing's decision to delay delivery of its 787 Dreamliner aircraft may result in lower shipments of Spirit products over the next six months. Spirit said it will assess the financial impact on its revenues, earnings, and cash flow over the coming weeks and provide an update Nov. 1.

Sunoco Inc. (SUN) signed a long-term lease agreement with Castleway Properties for about 105,000 square feet of office space in Tinicum, Pa., as part of a plan to consolidate engineering and other support services. Financial terms of the lease weren't disclosed.

Zumiez Inc.'s (ZUMZ) September same-store sales increased 13.9 percent. Wall Street expected growth of 6.6 percent. The Everett, Wash., specialty retailer said total sales for the five weeks ended Oct. 6 rose 11.8 percent to $32.1 million from $28.7 million.