Kenexa Corporation (NDAQ:KNXA) said it expects to meet or slightly exceed its previously issued guidance for the quarter ended December 31, 2006, relating to the company's revenues and non-GAAP operating income. Kenexa also announced that it intends to file a prospectus supplement with the SEC relating to an underwritten public offering of 3.75 million shares of its common stock under an effective shelf registration statement.

LeCroy Corporation (NDAQ:LCRY) said for the FY07 Q2, they expect to report revenues of approximately $38 million, versus the consensus of $42.85 million. They will expect orders in the second half of the year to increase by ten to seventeen percent to the range of $80 to $85 million. This should translate into total revenues in the range of $155 to $160 million for full year fiscal 2007.

Ultralife Batteries, Inc. (NDAQ:ULBI) expects to report Q4 revenue of approximately $31 million. These results are in range with the previous guidance, which estimated revenue of approximately $35 million for the fourth quarter. The consensus is $33.8 million.

Guitar Center, Inc. (NDAQ:GTRC) said consolidated net sales for the fourth quarter increased nearly twelve percent to $628.5 million, below the consensus of $643 million. The Company anticipates net income for the fourth quarter will be below its previous guidance range of $34 million to $36 million, or $1.14 to $1.20 per diluted share. The consensus is $1.16.

Perficient, Inc. (NDAQ:PRFT) is raising its revenue guidance for the fourth quarter of 2006. The Company expects its fourth quarter services and software revenue to be in the range of $48.4 million to $49.6 million, versus previous guidance range of $42.4 million to $45.1 million. The consensus is $44.57 million.

Merix Corporation (NDAQ:MERX) announced that Mark Hollinger has stepped down as Chairman and Chief Executive Officer, and will be leaving the Company. The Board has formed a search committee to find a successor. William C. McCormick, the Board's Lead Director, has been named Chairman and Interim Chief Executive Officer to serve while the Company conducts a search for a successor CEO. McCormick has been a director of Merix since 1997.

Sciele Pharma, Inc. (NDAQ:SCRX) raised revenue guidance for full-year 2006 to between $290 million and $292 million from the previously announced range of $287 million to $290 million, and raised the earnings guidance to between $1.18 and $1.20 per share from the previously announced range of $1.16 to $1.19 per share. The current FY06 revenue consensus is $290.57 million and EPS consensus is $1.19. The company also foresees their full-year 2007 revenue guidance to be $335 million to $350 million and diluted earnings per share guidance of $1.53 to $1.62. The current FY07 revenue consensus is $343.19 million and EPS consensus is $1.57.

California Pizza Kitchen, Inc. (NDAQ:CPKI) announced today that revenues increased 16.4% to $146.0 million for the fourth quarter, which compares to the consensus of $143.6 million. Comparable restaurant sales increased approximately seven percent. Management is increasing its earnings per diluted share guidance to $0.15-$0.17, versus prior guidance of $0.13-$0.15. The consensus is $0.15.

Eaton (NYSE:ETN) is increasing its guidance for fourth quarter earnings by approximately five cents per share. The EPS is between $1.55 and $1.65, while the current consensus is $1.57.

Electro Scientific Industries Inc. (NDAQ:ESIO) found its stock being accumulated again by Nierenberg Investment Management, who disclosed a 10.8% stake in a Schedule 13D/A filed with the SEC. Nierenberg first got involved with the company not long ago when they asked the company's board to cure the its excessive capitalization by instituting a one-time $4.00 dividend. With this request currently under consideration, the hedge fund is now presenting additional analysis reasoning that the company could be worth as much as $40 per share in three or four years.

According to the filing:

"ESIO has an additional $8 million of cash, not included in the cash and marketable securities lines of the balance sheet, $1 million from a subsequent insurance settlement and $7 million in a litigation bond in Taiwan, which increases cash per share to $7.73 ... If ESIO were to restore inventories and receivables to June 3, 2006 levels (we believe both ultimately can be reduced even more), and if we were to add the above-mentioned $8 million cash, ESIO's total cash and marketable securities would be $8.21 per share, 43.2% of ESIO's share price at the close on January 9. ESIO is profitable, cash flow positive, and it has zero debt."

The hedge fund also laid out its reasoning behind increasing its stake in the company:

1. We believe that ESIO has excellent management.
2. ESIO enjoys world leading market shares in its three major product lines, which give it the potential to earn an attractive return on equity.
3. The combination of organic growth, increased R&D investment, a number of promising new product releases, and possible acquisitions could enable ESIO to double its revenues over the next three to four years. Management has shared this goal with the public on several occasions. Given the company's business model, such growth would drive earnings per share north of $2.00, and, in our view, ESIO's share price to $40, more than double its current depressed level.
4. ESIO continues to have a fortress balance sheet, fed by free operating cash flow from profitable operations.

Many are skeptical, however, as the company's share price has dropped through 2006 from around $25 per share to settle at its current level of $19 per share. Moreover, while the hedge fund presents many valid arguments for a higher share price, much of it is contingent upon the company's ability to execute and other investors' confidence in management. However, this company is definitely one worth watching over the next few months and years as the company works to implement strategies to unlock shareholder value.

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Delta Air Lines, Inc. (OTC:DARLQ) moved up $0.08, or 6.15%, to $1.38 this morning on news that the company has received an increased unsolicited bid from U.S. Airways. The new offer is for 89.5 million shares of U.S. Airways stock and $5 billion in cash, compared to the original offer of 78.5 million in stock and $4 billion in cash. Obviously, the overall value of the deal depends largely on the value of U.S. Airways stock; however, they estimated the new bid at between $12.7 billion to $15.4 billion.

While Delta has already disclosed their five year plan to emerge from bankruptcy, there are many investors and debt-holders that are looking to get their money back sooner through a merger or sale of the company. However, in an official response, Delta said, "Delta's Board of Directors will fulfill its fiduciary duty to review the revised unsolicited merger proposal announced today by US Airways. On its face, the revised proposal does not address significant concerns that have been raised about the initial U.S. Airways proposal and, in fact, would increase the debt burden of the combined company by yet another $1 billion." Clearly, this bid is an improvement; however, without management approval it is unlikely that the bid will go through. But, with the possibility for further dialogue between U.S. Airways and Delta, there is a possibility that an agreement could be reached. This makes Delta a stock worth watching over the next few months.

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Greenbrier Companies (NYSE:GBX) reported Q1 earnings of $0.12 per share, in-line with estimates. Revenues came in at $246.6 million versus the consensus of $228.4 million. They foresee the FY07 EPS to be $2.15 to $2.40 versus the consensus of $2.92.

New York & Company, Inc. (NYSE:NWY) currently expects fourth quarter diluted earnings per share at the low end of the earnings guidance range provided on November 16, 2006 of $0.37 to $0.46. The current consensus is $0.40.

The Talbots, Inc. (NYSE:TLB) announced that earnings per share on a reported basis for the fourth quarter ending February 3, 2007 is expected to breakeven with an adjusted EPS of $0.04. This reflects a $0.07 decline in the Talbots brand performance versus the same quarter last year, a higher than anticipated loss at the J. Jill brand. The current consensus stands at $0.30.  The company sees Q1 of 2007 GAAP EPS between $0.36 to 0.43; the current consensus is $0.56.

Helen of Troy Limited (NDAQ:HELE) reported Q3 EPS of $0.72, versus the consensus of $0.85. Revenues came in at $213.4 million versus the consensus of $203.97 million, with a Q4 EPS of $0.25-$0.30 versus the consensus of $0.36 and an EPS of $1.53-$1.58 versus previous guidance of $1.70 to $1.80 and the consensus of $1.77. There are estimated FY07 revenues of $626-$631 million versus the consensus of $621.05 million. For the fiscal year beginning March, the company is providing guidance of annual sales in excess of $660 million and annual earnings in excess of $2.00 per diluted share. The consensus stands at $652.7 million and $2.01, respectively.

Volt Information Sciences, Inc. (NYSE:VOL) reported Q4 EPS of $0.86, twenty-four cents better than estimates. Revenues were $610.2 million versus $615.96 million consensus. VOL reported the FY06 EPS of $1.97 and revenues of $2.3 billion, with the current FY EPS consensus of $1.73 and the revenue consensus of $2.34 billion.

Audiovox Corp. (NDAQ:VOXX) reported a Q3 EPS of $0.17, two cents better than estimates of $0.15. Meanwhile revenues came in at $151.83 million versus the consensus of $148.77 million.

Oxford Industries Inc. (NYSE:OXM) reported a Q2 EPS of $0.68, versus the consensus of $0.69. Consolidated net sales increased nearly five percent to $291.0 million, versus the consensus of $290.35 million. They foresee the Q3 EPS to be $0.52-$0.60 versus the consensus of $0.86 and the FY07 EPS to be $3.00 to $3.15 versus the consensus of $3.33. The FY07 sales are estimated to be between $1.14 billion and $1.16 billion compared to initial full year guidance of $1.16 billion to $1.18 billion and the consensus of $1.17 billion.

Ramtron International Corporation (NDAQ:RMTR) expects to report product revenue of approximately $9.1 to $9.2 million. This result compares to the outlook management provided in its Q3 earnings which estimated product revenue between $10.2 million and $11.2 million.

Alcoa (NYSE:AA) reported Q4 EPS of $0.74, nine cents better than estimates while revenues were $7.8 billion versus $7.63 billion.

Apple Computers, Inc. (NYSE:AAPL) shares set new highs today after moving up $7.10, or 8.31%, to close at $92.57. The move was driven by the company's introduction of its much-anticipated iPhone device, which will be able to play music and take pictures, among other things. Investors are hoping that this new device will be able to disrupt the cell phone market in the same way that the iPod has dominated the MP3 player market shortly after its introduction. Moreover, the device's ties to several other key Apple services - most notably its iTunes music service - could help boost earnings in other areas. Jobs, not adverse to a little hyperbole, boldly stated, "We are all born with the ultimate pointing device - our fingers - and iPhone uses them to create the most revolutionary user interface since the mouse" calling the new device "revolutionary and magical". While the device won't be available in the states until June, the company did reveal their pricing at $499 for the 4gb model and $599 for the 8gb model.

The company also announced that it would be changing its name from "Apple Computers, Inc" to a much simpler "Apple, Inc", marking its move from strictly computers to consumer electronics.

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The London Stock Exchange reported excellent results, just a day after the Nasdaq (NDAQ:NDAQ) stepped up its attempt to win over LSE shareholders. The LSE reported a 9.9% rise in third quarter fiscal profits, while operating profits excluding one-time expenses increased 50% with revenues increasing 11.1%. The LSE attributed the growth to a 57% growth daily trading volume to 342,000, which came in significantly above the company's prior estimates. "The exchange is confident of an excellent outcome for the current financial year and continuing strong business fundamentals should ensure a strong performance for the financial year ending March 31, 2008," the exchange said in a statement. "This excellent performance supports the board's rejection of Nasdaq's offer, which significantly undervalues the business and the exchange's unique strategic position." The LSE also said the number of IPOs on its main market rose 39% to 50% during the quarter, along with a 68% increase in the average size of each new issue.

Clearly, this development puts increased pressure on Nasdaq, who argued that the exchange would experience difficulty competing in the future. Specifically, the Nasdaq said that the exchange would have to lower its costs in order to maintain market share; however, this recent development illustrates that this may not be true. Combined, these factors may make LSE shareholders think twice before approving a merger, despite the NDAQ's significant stake in the LSE that it threatened to sell off if the transaction fell through. Regardless, these stocks are two that are certainly worth watching during the next few months.

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The Gap Inc. (NYSE:GPS) shares jumped more than 7% during yesterday's trading session to settle around $20.25. The move comes after several sources noted that the troubled company has hired Goldman Sachs to look at possible strategic alternatives, which may include a sale of the company. It is unclear whether there is substance to this story; however, the company did admit that it had a relationship with Goldman Sachs, but not necessarily in that regard.

The rumor of a Gap buyout has been alive for more than two years, with our most recent coverage taking place on December 7th. Since then, investors have continued to be disappointed with the company's lackluster performance during the holiday season, after the company said the poor sales would "severely" affect earnings. Then came the comment from Pressler that caused the speculation, "Given that we did not gain the traction that we had expected, the management team, with the active involvement of our board of directors, is currently reviewing Gap's and Old Navy's brand strategies." Moreover, investors continue to be upset over the CEO's 100% raise last year, while the company's stock continues to suffer losses.

There are, however, a few barriers to any leveraged buyout. First, the company's founder, Donald Fisher, and his family still own approximately 36% of the company, and they are not exactly keen on selling it. Secondly, many investors note that this acquisition would be a huge one, amounting to around $20 billion, which may put it out of the league for many private equity players. And finally, with the company's disappointing performance, it could take awhile for any suitor to turn around the company and make money on the deal. Rather, many believe that the CEO will be fired before any drastic strategic alternatives are implemented. Regardless, this is definitely a company to keep an eye on during the next few months.

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Advanced Medical Optics, Inc. (NYSE:EYE) and IntraLase Corp. (NDAQ:ILSE) announced that the two companies have entered into a definitive agreement whereby AMO will acquire IntraLase for approximately $808 million in cash. Under terms of the agreement, AMO will pay $25 in cash per share of IntraLase stock and the individually determined cash value per share of outstanding stock options.

KLA-Tencor Corporation (NDAQ:KLAC) has agreed to acquire Therma-Wave (NDAQ:TWAV) via a tender offer for $1.65 per share in cash, in a deal worth $75 million.

Syntax-Brillian Corporation (NDAQ:BRLC) said that consolidated revenue for the quarter will be above $240 million with LCD TV shipments in excess of 350,000 units. The consensus stands at $189.23 million. The company also said gross margins will be in the top half of the range of 15% to 17% that was previously forecasted.

Delta Apparel, Inc. (AMEX:DLA) said that it expects second quarter revenues to be approximately $72 to $73 million versus its prior expectation of $74 to $78 million. Earnings are now expected to be in the range of $0.05 to $0.07 per diluted share versus its prior guidance of $0.14 to $0.18. The full fiscal year will show the company lowered sales expectations of $315 to $330 million from its prior guidance of $325 to $340 million. The company now expects diluted earnings per share to be in the range of $1.33 to $1.46 per diluted share for the 2007 fiscal year versus its prior guidance of $1.81 to $2.00 per diluted share.

The Houston Exploration Company (NYSE:THX) entered into a definitive agreement with Forest Oil Corporation (NYSE:FST), under which Forest will acquire all of the outstanding shares of Houston Exploration for approximately $1.5 billion in cash and Forest common stock. Forest will also assume approximately $100 million of Houston Exploration net debt. Under the terms of the agreement, Houston Exploration shareholders will receive total consideration equal to 0.84 shares of Forest common stock and $26.25 in cash for each outstanding share of Houston Exploration common stock.

Tellabs (NDAQ:TLAB) said that it sees Q4 revenue of $455 million to $470 million, versus the consensus of $534.2 million. Non-GAAP earnings per share, assuming dilution, are expected to range from ten cents to twelve cents, versus the consensus of fourteen cents.

MarineMax, Inc. (NYSE:HZO) expects its earnings per share for its fiscal year ending September 30, 2007 to range from $1.40 to $1.50 on a fully diluted basis from the previous range of $2.05 to $2.15. The company expects a Q1 revenue of approximately $235 million driven by same-store sales growth of approximately 14% and approximately $29 million from stores that were opened or acquired that are not eligible for inclusion in the same-store sales base. Due to additional team member and product incentives, higher marketing and promotional costs which were necessary to drive the company's sales, operating margins were negatively impacted, which is expected to result in a first quarter loss per share ranging from $0.20 to $0.25 per diluted share.

United Surgical Partners International, Inc. (NDAQ:USPI) said that they signed an agreement to merge with UNCN Acquisition Corporation. Under the terms of the merger agreement, the holders of USPI common stock will receive $31.05 per share in cash for their shares, in a transaction valued at approximately $1.8 billion. The company expects Q4 revenues to be in the range of $295 million to $300 million, which is above the high-end of the company's previous guidance of $255 million to $265 million. The company now expects diluted earnings per share for the fourth quarter to be $0.28 to $0.31, exceeding the company's previous guidance for the fourth quarter of $0.22 to $0.27. The consensus is $262.3 million and $0.27, respectively.

SKECHERS USA (SKX) now expects revenue for FY06 to be in the range of $1.196 to $1.201 billion, above its previous guidance of $1.156 to $1.166 billion, and diluted earnings per share for the full year are expected to be between $1.55 and $1.58, exceeding the company's previous guidance of $1.49 to $1.54. The consensus is $1.16 billion and $1.51, respectively.

LSI Industries Inc. (NDAQ:LYTS) said that it expects net sales of approximately $80 million and diluted earnings per share between $0.19 and $0.22 for Q2. Current analyst estimates range between $0.25 and $0.29 per share with a consensus of $0.26. Management now expects diluted earnings per share to be between $0.88 and $0.93 for the fiscal year ending June 30, 2007. This compares to management's previous guidance of $0.94 to $1.03 per share and analyst estimates of $0.95 to $1.12 per share with a  consensus of $1.00.

Venezuela's Chavez is calling for the nationalizing of the electricity and telecom sectors. Consequently, Compania Anonima Nacional Telefonos de Venezuela (NYSE:VNT) was halted for trading.

Integral Systems Inc. (NDAQ:ISIS) found itself under pressure from 12% holder Fursa Alternative Strategies, after the fund announced that it would be nominating two of its own members to the company's board of directors at the next annual shareholders meeting. These nominees include their Chief Investment Officer William F. Harley and director William F. Leimkuhler. The move to replace members of the board comes as a result of the company's inability to execute strategic alternatives to unlock shareholder value, which the fund said it finds "troubling". The company hasn't made any progress since last October when they noted that they were seeking strategic alternatives, which could include a possible sale of the company.

According to the fund's Schedule 13D filing with the SEC:

"As the Company's largest shareholder, we would like to see the Company's corporate governance significantly improved. The Company's Board and Management seem to require regular reminding of the need to significantly increase shareholder value. To better understand and act more in accordance with owner interests, we now believe the Board must include institutional investor representation. To that end, Fursa Alternative Strategies hereby nominates William F. Harley, III to the Company's Board for election as a Director at the Company's next Shareholder meeting. Fursa also nominates for election as Director at the next Shareholder meeting William F. Leimkuhler, who presently serves as a Director of the Company." (Read More)

If Fursa is successful in obtaining two seats on the company's board, it could result in the company adopting strategic alternatives to unlock shareholder value. The stock is currently off its highs of around $33 in September to its current level of $23.29.

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Nasdaq Stock Market, Inc. (NDAQ:NDAQ) stepped up their efforts to acquire the London Stock Exchange (LSE) by foregoing an unresponsive board and taking their case directly to shareholders. The Nasdaq said that their $5.2 billion offer not only represented a fair price, but also argued that such an acquisition was necessary both companies in order to effectively compete with NYSE/EuroNext's transatlantic exchange.

Nasdaq also increased the pressure on shareholders and the board by noting that they could unload their entire 29% stake in the company without suffering a loss. Such actions would put heavy pressure on LSE shares, likely bringing them down to 1,100 pence or lower. Alternatively, they noted that there is significant overlap between NDAQ customers and LSE customers, which means they could choose to compete directly with the exchange if the offer falls through. Combined, these factors put significant pressure on LSE's board to act in favor of the deal, or face heavy shareholder criticism.

Nasdaq shares moved up $0.65 or 2% to $33.75 in mid-day trading on the news.

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