Merck & Co. (NYSE:MRK) shares jumped today after the company announced third quarter proits that soared 62% on improved sales of asthma and diabetes drugs and a lower reserve for product liability litigation. The move marks a continued turnaround for the once-struggling drug company.

"The momentum Merck began to build last year continues, as proven by the strong performance this last quarter," said chief executive Richard Clark during a conference call Monday. "In an increasingly difficult health-care environment, our company has been resilient."

Merck's revenues jumped to $6.07 billion from $5.41 billion a year ago while the company's net earnings came in at 75 cents per share compared to 51 cents a share a year earlier. The company's strongest drug is its asthma treating drug Singulair, which is expected to earn at least $4 billion in 2007.

The big surprise was Gardasil - a vaccine to prevent cervical cancer that was introduced last year. The drug experienced sales of $418 million compared with $70 million a year earlier with year-to-date sales exceeding $1.1 billion. This sets the drug on track to be a blockbuster after only nine months - a great achievement in drug development.

In the end, this is all great news for Merck shareholders. The future success of the company will depend on their ability to launch successful drugs in a harder market while losing some of their key drugs that are expiring. Combined, these factors make MRK a stock worth watching!

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Citrix Systems (NDAQ:CTXS) announced this morning that it has closed its acquisition of XenSource for $500 million which was first announced in August. The move makes Citrix the first company to offer end-to-end virtualization, including application, desktop and server virtualization solutions. The news sent Citrix shares up more than three percent so far today.

"Citrix is now positioned to be a key provider of server, desktop and application virtualization technologies, a market which IDC expects to be worth in excess of $3.4 billion by 2011," said John Humphreys, program vice president, IDC. "Citrix's new end-to-end virtualization offerings augments the company's application delivery strategy and represents the foundational components of the future application delivery environment."

The new virtualization portfolio includes server virtualization with Citrix XenServer, application virtualization with Citrix Presentation Server and desktop virtualization with Citrix XenDesktop. Combined, these solutions enable businesses to essentially run their entire computing platform from one remote server and have computers "dial-in" to the server every time they require access to key programs and applications.

Many investors are bullish on this news as the stock may start to move the same way as VMware, which has exploded in value recently. Citrix shares are trading near their 52-week highs of $42.90 and well off their lows around $26.10. The company trades at a 36x earnings multiple, however, which is substantially lower than VMware's 270x valuation.

In the end, Citrix is definitely a stock to keep an eye on as it will likely become a key player in the extremely hot virtualization market. Some traders are even considering a pairs trade between the overvalued VMware and the undervalued Citrix given that they are now in the same market. Combined, these factors make CTXS a stock worth watching!

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A large Building Materials Holding Corporation (NYSE:BLG) shareholder is stepping up its pressure on the company to rid itself of chief executive Robert Mellor and promote Sanley Wilson, according to a Schedule 13D/A filing with the SEC. Many shareholders are hoping that the activist can take action to clean up corporate governance practices and unlock value in the struggling company.

Chapman Capital, which controls over 9 percent of the company, demanded the resignation of chief executive Robert Mellor and his replacement with Stanley Wilson. The activist hedge fund insists that the executive's total compensation over the last three years is excessive given today's market conditions. Meanwhile, an insignificant stake in the company only indicates a lack of conviction.

"BMHC’s owners obviously should hold Mr. Mellor neither commendable for yesterday’s homebuilding boom that enriched him, nor accountable for today’s bust that perversely continues to enrich him," said Chapman Capital in a statement. "BMHC’s holding company structure, with Mr. Mellor serving as the Company’s '$6 Million Man' in personal total compensation over the past three fiscal years, is out-of-date and untenable in today’s challenging homebuilding environment."

Problems compounded recently after Standard & Poor's placed BHCM's ratings on "Credit Watch with negative implications" as a result of the board's "corporate governance lapse". Interestingly, the S&P cited the current battle between Chapman Capital and the company in determining this lapse in corporate governance. Clearly, there is an issue that needs to be addressed very soon before shareholders suffer even more.

In the end, the problems facing BMHC is one that can no longer be ignored. The imbalance between the ownership and governance of the company has resulted in a stock price that has declined nearly 60 percent to 2004 levels. The extraordinarily low valuation, trading around tangible book value, should send the board a very clear message of Wall Street's distrust and diffidence in BMHC's management and board members.

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