Bankrate Inc. (RATE) added 5% to $40.37 today after the company was initiated with a buy rating at American Technology Research with a price target of $48.

Ceragon Networks Ltd. (CRNT) shares jumped over 16% after the Israeli wireless provider reported first-quarter net earnings of $2.62 million, or 9 cents per share, up from $228,000, or one cent per share, a year ago. Revenues rose to $33.9 million from $21.3 million a year ago. Analysts were expected 9 cents per share on revenues of $32.4 million.

Datawatch Corp. (DWCH) shares rallied 25% after the enterprise information management applications provider reported second-quarter earnings of $424,000, or 7 cents per share, up from $227,000, or 4 cents per share, a year ago. Revenues rose 14% to $6.1 million for the year.

Ionatron (IOTN) shares jumped 21% after the U.S. Navy posted a notification on the Federal Business Opportunities Web site about the award of a sole source contract regarding the company's Counter IED technology. Ionatron disclosed the posting of the contract which is worth about $500,000.

Sigma Designs (SIGM) shares dropped 12% after the company was downgraded to sell from neutral at American Technology Research.

Rigal Pharmaceuticals (RIGL) dropped 6.2% after the company said that it plans to sell five million shares under an existing shelf registration statement with an over-allotment option for an additional 750,000 shares to the underwriters.

Citigroup (C) management is reportedly concerned that the company could become an activist takeover target, according to a report by the Financial Times. The executives are concerned that the company may represent an attractive breakup opportunity, while many dismiss the rumors on grounds of its size.

Merrill Lynch (MER) said it would buyback $6 billion in shares.

Dominion (D) agreed to sell its Gulf of Mexico assets to Italian energy group Eni (E) for $4.8 billion.

Hexcel Corporation (NYSE:HXL) shares jumped $0.77, or 3.61%, to $22.11 today after O.S.S. Capital Management disclosed a 5.1% stake in the company and expressed their concern over the company's recent under-performance in a Schedule 13D filing with the SEC. The hedge fund first contacted the company on March 9, 2007 when it sent a letter expressing concern regarding the company's operating performance relative to its peers and management's lack of concern regarding the gap in performance. O.S.S. also noted that one member of the company's board of directors was stepping down and suggested a candidate for his replacement.

The letter cited the company's operating margins - which stand near 10% now - as being the primary issue. While the company has increased this number from 7% in 2002 to 10% now, Cytec Industries' Engineered materials segment is now generating operating margins of 18% while Toray Industries' is even higher. Had the company achieved 17% operating margins on its 2006 revenues, the company would have earned an additional $78 million in operating income. And by applying the current 17x multiple of EV to operating income, this difference would result in a value increase of more than one billion dollars. This equates to more than $14 per share above the current share price! The hedge fund blames this inability to achieve proper valuation on poor management, which it believes needs to be replaced.

The next move came on April 9th when Hexcel Corporation's CEO visited O.S.S.'s offices to discuss these matters more deeply. But these talks seemed to have gone no where after the hedge fund reiterated its concerns shortly later and requested that a committee of independent directors be formed and that the committee retain an independent investment bank to advise as to how shareholder value could be best maximized. The hedge fund simply stated that the company is under-earning, management is not addressing the shortfall in earnings, and the shareholders are suffering. Therefore, an evaluation of strategic alternatives may be the only way for changes to take place. Whether or not this process happens smoothly depends largely on the company's board of directors. If they oppose, we could be in for a battle. However, if they agree, it could mean significant upside for the company's shareholders. This makes HXL a stock worth watching!

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Yahoo! Inc. (NDAQ:YHOO) announced the acquisition of privately held Right Media today for $680 million just a week after Google Inc.'s (NDAQ:GOOG) well-publicized acquisition of DoubleClick. Right Media is a privately held company that enables publishers to buy and sell online ad placements in real time through an auction system - a system very similar to that of DoubleClick. The move will give Yahoo the ability to sell and broker ads outside of its own network of websites and diversify its revenues to better compete with Google.

The move marks continued consolidation in the highly-competitive online advertising market as giants Yahoo, Google, AOL and Microsoft compete to broaden their audience. Notably, Microsoft (NDAQ:MSFT) and TimeWaner's AOL (NYSE:TWX) have yet to obtain a presence in the more traditional banner advertising market to compliment their existing contextual search business. Clearly, both of these companies are interested in such acquisitions since they were involved in the bidding for DoubleClick before Google's blockbuster bid. So, what are some other potential targets for continued consolidation? Well, three key players have emerged: aQuantive (NDAQ:AQNT), ValueClick (NDAQ:VCLK) and 24/7 Real Media (NDAQ:TFSM). Right now, several of these names are down since Yahoo!'s acquisition involved a private company, suggesting that these players are somewhat overpriced. However, given Microsoft's large cash reserves and AOL's need to establish itself in the market, the buyout possibilities for these firms remains strong.

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