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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International Securities Exchange Holdings (NYSE:ISE) shares jumped $18.84, or 41.21%, to $64.56 today after Deutsche Boerse AG said it is in talks to acquire the company for $2.8 billion, or $67.50 per share. The company confirmed that it was in advanced discussions regarding a business combination while Deutsche Boerse said its board will recommend the transaction to its supervisory board. The acquisition would make Deutsche Boerse a large player in the U.S. options trading business.

Many other stock exchanges are also looking to combine or expand their businesses into other financial products that have higher profit margins than simply stocks. Perhaps the most visible company seeking an acquisition is the Nasdaq, which recently lost its bid for the London Stock Exchange. Many investors expect the company to buy its way into the options and derivative businesses through an acquisition like the Chicago Board of Trade. Deutsche Boerse's move places increased pressure on the exchange to act more quickly to secure its own spot in the international marketplace. The acquisition of ISE puts the exchanges in a renewed takeover spotlight, particularly companies like the Chicago Mercantile Exchange (NYSE:CME) and CBOT Holdings Inc. (NYSE:BOT)!

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General Electric Company (NYSE:GE) shares rallied $0.99, or 2.76%, to $36.84 today after Citigroup (NYSE:C) analysts recommended that the company spinoff NBC Universal, GE Money and the real estate division. The analysts suggested that GE's size and complexity is working against investors in the stock and has contributed to further value erosion. The move by Citigroup analysts follows similar suggestions from other analysts during the past few weeks. An analyst from Prudential Equity Group Inc. even suggested that Google (NDAQ:GOOG) may be interested in acquiring its NBC Universal division to compliment its YouTube media offerings.

Just how much could this move yield for investors? Well, some analysts like Jeffrey Sprague from Citigroup are pegging the breakup value at around $46 per share. Moreover, streamlining the company's operations would help give investors a greater understanding of the company and perhaps enable it to command a premium instead of trade at a discount. Clearly, these moves also have widespread support from the company's shareholder base who expressed concerns about the company's valuation at the last annual meeting. Whether or not the company heeds this advice remains to be seen, however, this is definitely a stock to watch in the meantime!

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ABN Amro Holding (NYSE:ABN) shares moved up $0.55, or 1.11%, to $50.08 today after a consortium led by the Royal Bank of Scotland said it would go ahead with plans to launch a hostile bid for the company in a move aimed at breaking up the friendly existing bid by Barclay's Bank. "The banks continue to believe that their proposals offer materially higher value for ABN Amro's shareholders and benefits to customers and employees compared with the recommended offer from Barclays," the banks said in a joint statement. Obviously, shareholders are also interested in seeing this new offer. The Children's Investment Fund - the activist hedge fund that owns 2% of ABN Amro and originally called for the breakup - welcomed the consortium's plan and described it as "compelling." Whether or not the board of directors agrees to review this new bid remains to be seen; however, this is definitely a stock to keep an eye on in case a bidding war breaks out.

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Applebees International Inc. (NDAQ:APPB) shares rose $1, or 3.89%, to $26.84 today after the company announced that it has received preliminary takeover offers and would begin a second round of due diligence with bidders before taking final offers. The company also said that it was exploring a recapitalization of the company as a possible alternative to a buyout. The moves come after Applebees settled with dissident shareholders Richard Breeden and his Breeden Capital Management LLC who threatened a proxy fight over board seats. As part of their settlement, the company agreed to explore strategic alternatives back in February. We covered this story in several past articles that outline the hedge funds problems and recommendations for changes at the company.

Now that the company has potential bidders on its doorstep, we can assume that it comes in at a premium higher than the current share price. After all, Applebees is a national chain that both financial and strategic buyers may be interested in turning around. The company was quick to note, however, that it was too early to comment on the likelihood or value of a recapitalization or sale, saying that there was no guarantee that a transaction would occur. Regardless, this is definitely a stock to watch as the company explores its options!

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Universal Power Group Inc. (NYSE:UPG) shares remained about even today after 3V Capital Management disclosed a 12.6% stake in the company and expressed their concern about UPG's stock price, which has fallen 33.6% since the IPO last December. The hedge fund said that it believes the stock is grossly undervalued at this price and that the company's board should work to create shareholder value in the most effective and expeditious way and do what is possible to ensure the market is reflective the fair value of the business as consistently and often as feasible. Consequently, 3V requested that it be able to express its ideas and views on ways to enhance shareholder value with representation on the company's board.

What exactly does the hedge fund want to accomplish? Well, according to their letter 3V has an excellent relationship with senior management and they intend to work closely with them and the board to help refine and better communicate their business strategy and operating plans to the investment community. Given the hedge fund's ties to institutional investors and the analyst community, it could help make the company much more known in the market. 3V also clued us into some other possibilities in Item 4 of their Schedule 13D filing where they noted that they may recommend transactions specified in clauses (a) through (j) of Item 4, which could mean a sale of the company, acquisition of other companies, changing of strategies, adopting or destroying anti-takeover measures, and restructuring the company's capitalization or dividend policy. In the end, there are clearly a lot of things that 3V could do, and with such a large stake in the company they should not have any trouble getting things done! This makes UPG a stock worth watching over the next few months!

Cerus Corporation (NDAQ:CERS) shares moved up $0.27, or 3.52%, to $7.94 after the company announced that it was evaluating strategic alternatives for its immunotherapy vaccine businesses. Cerus has three immunotheraputic product candidates with one in early stage human clinical trials and another for which an investigational new drug application is slated to be filed in mid-2007. The products are designed to stimulate immune pathways to target and attack cancer cells and infectious diseases. These strategic options could include a sale, merger, spinoff, or partnership with another company. Some investors had voiced concerns over the units valuation in the past and this move will enable the company to unlock the value for shareholders. This makes CERS a stock worth watching!

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MAIR Holdings, Inc. (NDAQ:MAIR) shares rose $0.32, or 4.43%, to $7.07 today after Shultze Asset Management disclosed a 5.9% stake in the company and expressed their disappointment over the company's plan to pursue acquisitions that may be outside of the airline industry using shareholder cash. The hedge fund believes that the company's best course of action would be to distribute any and all cash remaining after the reorganization to shareholders as soon as possible in a tax-efficient manner.

Shultze also suggested that the company initiate efforts to sell its Big Sky subsidiary by immediately retaining a nationally recognized investment banking firm. In the end, the hedge fund believes that the company's shares are undervalued based on the amount of cash that would be distributed to shareholders if the board implements its suggestions. Finally, Shultze said that it would not be adverse to seeking representation on the board if necessary in order to pursue its objectives. Combined, these factors make MAIR a stock worth watching!

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Alcoa Inc. (NYSE:AA) shares jumped $2.19, or 6.45%, to $36.14 after the company announced that it would explore strategic alternatives for its packaging and consumer business. The company said it would consider all options available including joint ventures, a spin-off, or sale of the business. In 2006, these businesses generated revenues of about $3.2 billion - or 10% of Alcoa's income. CEO Alain Belda said, "Our packaging and consumer business is improving and strengthening. However, now is the right time for us to explore whether these businesses may provide more value on their own or as a part of another company."

Separately, Alcoa also announced that it would explore strategic alternatives for its electrical and electronic solutions unit and its automotive castings business. These businesses had revenues totaling $1.6 billion in 2006, although they were only marginally profitable. The company said the process of reviewing these alternatives would be completed by the end of 2007. Many analysts see the move as beneficial for shareholders as it would unlock the value in these segments while allowing the company to focus more on their core competencies. There have also been rumors that Alcoa may be a buyout target, and selling off these divisions would make the company substantially cheaper. Whether or not anything amounts from this analysis remains to be seen; however, this is definitely a stock to watch!

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Emmis Communications Corporation (NDAQ:EMMS) shares moved up marginally after Martin Capital Management disclosed an 8.4% stake in the company and recommended that the company sell WQCD and possible KMVN, WKQX, and WLUP. CL King & Associates analyst James Boyle said that the station could be worth as much as $150 to $200 million. Moreover, the other stations listed by Martin Capital in Chicago and L.A. would also go for similarly high amounts. Combined, these transactions could help unlock significant value for shareholders.

According to Martin Capital, "the company would certainly have an opportunity to monetize valuable assets that are not contributing to cash flow in appropriate proportions to their private sale value". The hedge fund also speculated that these sales were the motive behind last years management buyout offer that was rejected by the board of directors as inadequate. While Emmis Communications refused to comment on any buyout rumors, this is definitely a stock to watch!

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Bausch & Lomb Inc. (NYSE:BOL) shares dropped $2.49, or 4.02%, to $59.44 retaining most of their gain from yesterday's speculation that the company could be a buyout target. The stock, options, and credit securities of the company continue to be very active today as investors continue to bet on the possibility of an LBO. But is there any merit to these rumors? Well, the company is down significantly from its 2006 highs around $80 per share after the company was forced to recall 1.5 million bottles of its ReNu MultiPlus contact lense solution and guided lower for the quarter. While the company continues to struggle with turning itself around after that setback, it has made the company's shares cheap given their market dominance and large portfolio. Perhaps this is why people are looking at the possibility of an LBO. Regardless, this is definitely a stock to keep an eye on!

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Genesco Inc. (NTSE:GCO) shares rose $0.88, or 1.76%, to $50.86 today after the company rejected Foot Locker's $1.2 billion - or $46 per share - offer for the company. We first noted the possibility of this bid back in March, when GCO shares were trading at $42 per share. Chairman and CEO Hal Pennington said, "Our board unanimously rejected the proposal and concluded that it did not reflect the long-term value of Genesco, including its strong market position and future growth prospects." Interestingly, the CEO also commented on Foot Locker CEO Matthew Serra's comments stating that his company would be willing to pay $48 to $50 per share and were willing to go higher. Finally, Jefferies & Co. confirmed in a note to clients that Foot Locker can be a higher price and still see benefits from the deal. After all, the purchase would lower the company's reliance on Nike Inc., which currently supplies half of the shoes it sells.

So, is a deal still on the table? Well, clearly there is interest by the purchasing party and Genesco at least took the time to officially review the bid before rejecting it. These actions suggest that Foot Locker may come out with a higher bid for the company, perhaps above $50 per share ceiling that was mentioned. Clearly this is what shareholders are banking on as the company's share price approaches $51 per share! Whether or not this goes through remains to be seen; however, GCO is definitely a stock to watch in the meantime.

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Encore Capital Group, Inc. (NYSE:ECPG) shares $0.80, or 7.43%, to $11.56 in early trading after the company announced that an investor group agreed to take a 25% stake in the company. The investor syndicate consisting of J.C. Flowers & Co. and FPK Capital will acquire the shares through privately negotiated transactions and become the company's largest shareholder. Encore is expected to invite representatives from J.C. Flowers, FPK Capital and Red mountain to join its board next month while several existing board members will step down.

Investors see this new group as a welcome change to a board and management team that has driven the stock down from almost $15 a year ago to its current levels around $11. However, the investor syndicate's Schedule 13D filing with the SEC outlined no clear plans on how it plans to unlock shareholder value. Moreover, the company has already explored strategic alternatives back in June of last year and was unable to produce tangible results. Whether or not the new investor syndicate can help shareholders remains to be seen, but meanwhile this is definitely a stock to watch!

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Google Inc. (NDAQ:GOOG) reported first-quarter profits that surged on increased advertising revenue from its search segment, which continues to outperform rivals Yahoo and Microsoft. Total revenues rose 63% as the company announced its plans to expand into new products and types of advertising. This has resulted in increased spending, however, which rose from $336.6 billion in the fourth quarter to $596.9 billion in the first quarter of this year. Moreover, shareholders will have to deal with the $3.1 billion acquisition of DoubleClick earlier this month, although Google believes this will immediately begin adding to their bottom line.

In an interview CEO Eric Schmidt speculated that Google's growing efforts to broker advertisements that appear in newspapers, radio, and television would become a significant portion of their overall revenues starting in 2008. Many analysts have suggested that Google needs such a boost in order to sustain its momentum, as the company's rate of growth continues to slow. This quarter's 63% growth compares to 67% in the fourth quarter and 79% in the first quarter of 2006. But for now, the company's continued dominance in the search market (controlling 55.8% of all search queries) continues to keep investors happy. The question is: just how long?

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Griffin Land & Nurseries Inc. (NDAQ:GRIF) shares moved up marginally today after Mario Gabelli disclosed a 31.1% stake in the company and expressed his concerns that the company's share repurchase plan was not moving along quickly enough. Gabelli said that he realizes it's due to options exercised, but at a minimum the company should have bought enough shares back to offset the dilution. Moreover, he noted that the value of the company is materially above where the stock is selling, so he remains somewhat miffed at the glacial speed of the company's share repurchase. The letter also says that Gabelli "looks forward to discussing the notion of harvesting our real estate assets". What this means remains to be seen. Meanwhile, if the company meaningfully increases its share repurchase plan, it could mean significant value being returned to shareholders. This makes GRIF a stock worth watching!

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eSpeed Inc. (NDAQ:ESPD) shares moved down 7.66% today after the company released a statement saying that it sent a letter on April 19, 2007 to Terry Smith of Tullett Prebon plc stating that the board of directors has been formed by its controlling stockholder, Cantor Fitzgerald, that it is not interested in selling its controlling interest in the company to Tullett, in terminating its arrangements with eSpeed on terms proposed by Tullett in recent letters, or in proposing alternative terms to Tullett. More, the company said it is not in a position to pursue Tullett's acquisition proposal because such a proposal cannot be consummated without the consent of Cantor Fitzgerald - the company's controlling stockholder.

The company also commented on other demands made by activist shareholders. They stated that they cannot take any of the following actions without Cantor's express approval: (1) convert Cantor's Class B common shares into Class A common shares, (2) undertake any business combination with another entity, or (3) terminate the perpetual clearing, technology and other arrangements with Cantor and its affiliate BGC Partners. While the board is fully aware of its fudiciary duties, it has determined that it is unable to do anything without Cantor's approval. This leaves few alternatives for activist investors who continue to hold large stakes in the company, including WC Capital and Chapman Capital. They can put additional materials on the proxy, but with Cantor controlling the majority of the votes, it will be very difficult to make any meaningful changes. At this point, all shareholders can do is wait for a response from the hedge funds or perhaps another higher offer by Tullett that would be high enough for Cantor to consider.

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The Topps Company, Inc. (NDAQ:TOPP) shares moved up marginally beyond the company's buyout premium amid shareholder and director criticism over its merger agreement with Tornate at $9.75 per share. Today, board director and 6.4% stakeholder Arnaud Ajdler reiterated his beliefs in a March 14th letter that the existing proposed merger is not in the best interest of the company's stockholders because the per share merger consideration is wholly inadequate and does not provide full and fair value to the company's stockholders.

The board director also let shareholders know of a part of the story that nobody else outside of the board knew. First, Topps did not solicit comments from Timothy Brog, John Jones, or Ajdler (board members opposing the proposal) or make available to them drafts of the merger proxy before filing it with the SEC. Secondly, there was a third bidder for the company (Bidder C) that proposed a purchase price that was $1 per share more than the current offer, not contingent on financing, had the potential to be raised even higher since this company was a strategic buyer. Third, the board of directors opposed a share buyback or special dividend to instead opt for a sale, stating it would be the best way to maximize shareholder value. Yet, the most recent share buyback program that was approved by the board had a top price of $10.62 per share. How can management and the board recommend paying up to $10.62 per share, but then approve a merger for $9.75 saying that it maximizes value? Finally, the company did not adequately shop itself as it suggested in its press releases. The merger proxy indicates that it only approached three financial buyers before entering into a deal with Tornate. The statement also makes it clear that Topps never approached Bidder C - its main competitor that had expressed interest in the company even before the announcement of a transaction with Madison Dearborn and Tornante.

Overall, it appears as if the company's board has violated its fudiciary responsibilities by ignoring superior bids and failing to maximize shareholder value. With the current stock price trading above the buyout premium, it appears as if most investors are hoping that the merger will fall though and other bids will be examined. This makes TOPP a stock worth watching!

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eSpeed Inc. (NDAQ:ESPD) shares moved up $1.13, or 11.71%, to $10.87 today after the company's takeover offer for Cantor was rejected. Meanwhile, Chapman Capital disclosed a 9.3% stake in the company and demanded consent to replace eSpeed directors at the company's 2007 annual meeting. The hedge fund also reiterated its demands that the board immediately retain an independent auditor to review the Joint Services Agreement, compel the conversion of all Class B common shares into Class A common stock, and engage an investment bank to maximize shareholder value via an auction of the company.

Robert L. Chapman, Jr., Managing Member of Chapman Capital, commented, "Chief Executive Howard Lutnick's three-kingdom reign over Cantor Fitzgerald, eSpeed and BGC Partners appears so infested with potential conflicts of interest and incestuous inter-company transactions that a completely new set of corporate governors may be required to exterminate any vermin from eSpeed's board room. Chapman Capital finds it astonishing that Mr. Lutnick may believe he retains the residual credibility necessary to bedazzle a new group of investors in the proposed BGC Class A concoction after stupefying eSpeed Class A shareholders with years of underperformance and apparent disrespect."

Regarding Chapman Capital's demand for the immediate auction of eSpeed, Mr. Chapman stated, "The non-return of 24 straight business days of telephone calls from eSpeed's largest Class A owner is something one might have expected from multi-kingdom conflicted tyrants such as Hollinger International's Conrad Black, but not someone as conscious of his public reputation as Mr. Lutnick. Moreover, today's disclosure of the seemingly impulsive rejection of Tullett Prebon Plc's premium acquisition proposal has done nothing but heighten our concerns that Napoleonic behavior continues to be condoned by eSpeed's director fiduciaries."

In the end, if the hedge fund is successful in obtaining seats on the company's board of directors, it is likely that there will be some kind of a process to explore a sale of the company. Until then, investors and shareholders have to wait to see if the company will take action to eliminate some of the barriers to making this happen. Regardless, this is definitely a stock worth watching!

View past eSpeed articles

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Marsh & McLennan (NYSE:MMC) shares continued their rise today moving  up an additional 1.78% after jumping 3.5% yesterday on rumors of a private equity bid. The WSJ said, however, that a person familiar with the company's thinking said nothing is in the works. Notably, the company is in the process of turning itself around after CEO Michael Cherkasky cut costs and restructured the business since taking over in October 2004. As part of this turnaround, the company sold off its Putnam Investments division for $3.9 billion late last year and reported healthy earnings last quarter. But despite these changes, the company continues to trail the S&P 500 index even after its move this week. This has caused many investors to remain skeptical as to the company's long-term ability to provide predictable returns to investors. While a buyout is nothing more than a rumor at this point, MMC is definitely a stock worth keeping an eye on!

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EBay Inc. (EBAY) announced that its quarterly earnings and sales came in higher than expected by Wall Street, pushing the company's shares up nearly 3%.

Spansion (SPSN) shares dropped 20% after the chipmaker posted a wider quarterly loss and outlined a restructuring plan. The company said it would be facing weaker prices for its flash chips due to competitive pressures.

Novellus Systems Inc. (NVLS) shares dropped 2.8% after the company forecast second quarter earnings of 42 cents to 45 cents per share.

E-Trade Financial Corp. (ETFC) cut its 2007 forecast due to a reduction in customer trading amid market volatility. The company forecast FY2007 earnings of $1.55 to $1.75 compared to analyst estimates of $1.62 to $1.78 per share.

Gilead Sciences Inc. (GILD) shares moved marginally higher after the company announced first-quarter results that surpassed analysts' expectations. The company also backed its 2007 product revenue and earnings forecast.

Avici Systems Inc. (AVCI) shares fell 27% after the company said it was transitioning away from core router development to focus on its new product iniative. The company also said that it swung to a quarterly profit and declared a special cash dividend of $2 per share.

Yahoo Inc. (YHOO) shares dropped 11.8% on triple the normal volume after the company's profits dropped 11% on higher operating costs as it spent more to compete with Google. The results disappointed analysts and investors who expected better profit and sales figures in light of a new upgraded ad feature known as Panama.

ASML Holding (ASML) shares moved up 5% after the company said first-quarter profit nearly doubled as it shipped more machines used to make chips for mobile phones and iPods.

Carrington Laboratories (CARN) shares rose almost 8% today after the company announced supply and patent license agreements for at least 10 years with Primus Pharmaceuticals Inc.

Avanir Pharmaceuticals (AVNR) shares rose over 300% after the company announced positive top-line results from its Phase III clinical trial evaluating the investigational drug Zenvia in diabetic neuropathic pain.

Claxson Interactive Group, Inc. (OTC:XSONF) shares moved down 4.26% today after Black Horse Capital Advisors disclosed an 8.4% stake in the company and revealed the disturbing details of a March 23rd proposed transaction in which Claxson and its controlling shareholders indicated their desire to purchase the remaining minority shares at $10.50 per share - below the current price of $11.25.

The problem arises when we see that Claxson announced the sale of certain Pay TV assets to Turner Broadcasting for $235 million along with the sale of Ibero American Radio Chile to the Prisa Group for $75 million. The hedge fund noted that the closing of these two transactions and the interim cash flow generation will likely produce a net cash position (afer paying all the remaining holders of company debt) that will significantly exceed the offer price. Furthermore, the proposed transaction does not compensate minority shareholders for Claxson's remaining valuable assets. These amount to an even higher price well above the $10.50 per share offer price. Consequently, the hedge fund recommended that the Special Committee in the board of directors should reject the offer as inadequate. If the offer is rejected and a higher offer is made, it could mean significant appreciation for shareholders. this makes XSONF a stock worth watching!

Point.360 (NDAQ:PTSX) announced yesterday that it had entered a merger agreement with DG FastChannel, Inc. (NDAQ:DGFC). Under the terms of the agreement, DGFC will acquire Point.360's spot advertising distribution business, and Point.360 will spin off its remaining businesses to its shareholders. DGFC will also be assuming up to $7 million in Point.360's debt while providing it with $3 million in cash for the working capital of the other business.

As a result of the spin-off, Point.360 shareholders will continue to own shares in the New 360, which focuses on high definition and standard definition mastering, sophisticated computer graphics, data conversion and video, film and media asset management services. The existing Point.360 senior management will stay with the new company that will be basically debt free and generating revenues of about $45 million to $50 million with EBITDA around $4 million to $6 million during the next 12 months. This is great news for shareholders as they will not only receive a payment from DGFC, but also shares in a new spinoff - which tend to outperform the overall market in their first year. This makes PTSX a stock worth watching!

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BCE Inc. (NYSE:BCE) share moved up $1.98, or 6.17%, to $34.05 today after the company announced that it began discussions with a group of Canadian pension funds in connection with its review of strategic alternatives. The announcement confirmed rumors that have already brought the stock up about 26% since March 29th. Many analysts warn that any buyout may not come at much of a premium to the current market price while the downside if a deal falls through could be quite steep.

The company confirmed that it was in talks with the pension consortium consisting of Canada Pension Plan Investment Board, Caisse De Depot et Placement Du Quebec and Public Sector Pension Investment Board; however, the company restated its dismissal that it was working with KKR or private equity funds on a possible deal. Overall, BCE may not be the best stock to purchase right now as the premium is too high; however, it could be a shorting target if a deal falls through or a buyout target if other bidders surface that would be willing to push up the price. Either way, this is a stock that is worth watching!

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BCE Inc. (BCE) rose 6.3% after the company said it entered into talks with three major institutional investors and a large private-equity firm about a potential buyout.

Black & Decker Corp (BDK) shares moved up 4.4% after the company raised its first quarter profit target amist strong international demand for power tools and other accessories.

Commerce Group (CGI) shares added 8.7% after the company was assigned to the S&P MidCap 400 index, replacing Adesa Inc.

East West Bancorp (EWBC) moved up 11% after the company reported first quarter earnings of 68 cents per share, up a year ago from 55 cents per share. The company also raised its guidance from $2.52 to $2.60 for the FY2007.

InsWeb Corp (INSW) shares more than doubled today after the company reported net earnings of 10 cents per share, compared with a net loss of 41 cents per share a year ago.

Lithia Motors (LAD) shares rose 7.2% after the company was selected to joing the S&P SmallCap 600 Index, replacing MapInfo Corp.

Nanogen (NGEN) shares rose 4.9% after the company submitted a 510(k) application to the FDA for its cystic fibrosis kit and NanChip 400 microarray system.

Telik (TELK) shares rose 9.2% after the company announced results from a Phase II clinical trial of the combination of Telcyta, carboplatin and paclitaxel in the first-line treatment of advanced non-small cell lung cancer.

Fair Isaac Corp (FIC) shaers lost 8.6% after the company cut its fiscal second quarter and 2007 forecasts.

Google Inc.'s (NDAQ:GOOG) buyout of DoubleClick Inc. is fueling speculation that there may be consolidation in the online advertising sector. Online advertising companies aQuantive Inc. (NDAQ:AQNT), 24/7 Real Media Inc. (NDAQ:TFSM), and ValueClick Inc. (NDAQ:VCLK) all moved up significantly on the news after investors and analysts suggested that they could become the next buyout targets. Meanwhile, others suggest that large players will likely seek more reasonably priced companies in the private sector instead of going after any of the larger public targets. Regardless, these are definitely stocks to keep a close eye on following Google's blockbuster acquisition!

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Atmel Corporation (NDAQ:ATML) shares rose 1.19% in early trading after George Perlegos announced the filing of a definitive proxy statement with the SEC in connection with his planned solicitation of proxies at the company's next annual shareholders meeting on May 18th. The founder and former president, CEO, and chairman of the company hopes to replace the company's current board with his own nominees and appoint an additional three candidates that he feels are highly qualified.

If successful, the 5.2% holder proposed several initiatives designed to unlock shareholder value:

• Promptly hiring a new, highly qualified and experienced CEO to replace the current underperforming one who had only 10 weeks of public company CEO experience before joining the company!
  
• Spinning-off Atmel's Smart Card business to its shareholders in order to convert the company to a microcontroller pure-play and deliver value to shareholders. We know that spin-offs tend to outperform the overall market in their first year!
  
• Selling Atmel's automotive business in Germany, which Mr. Perlegos believes can be sold for $400 to $500 million - a far better option than the current proposal to sell the company's wafer business in Germany.
  
• Divesting non-core assets, such as the company's NOR-flash business. This furthers the company's move to become a microcontroller pure-play and provides it with the cash to fund a share repurchase.
  
• Initiating a $500 million to $1 billion share repurchase program designed to boost the company's share price and unlock value for shareholders.
  
• Removing the current poison pill in accordance with the highest standards of corporate governance.

Clearly all of these proposed initiatives would be greatly beneficial to shareholders. The company's stock has already dropped close to 20% since the beginning of 2007 after the company announced further sequential decline in revenue of up to 8% for the first quarter. Obviously changes are needed and perhaps George Perlegos is the one to bring them; after all, he did successfully create and run the company for nearly 20 years! Combined, these factors make ATML a stock worth watching...

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ABN Amro (NYSE:ABN) shares moved up $2.49, or 5.44%, to $48.28 today after the Wall Street Journal reported that the Royal Bank of Scotland officially made a bid for the company. Up until now, the merger talks surrounding the company included only Barclays with mere speculation that there could be others in the mix. The Royal Bank of Scotland is supposedly teaming up with Fortis and Banco Santander Central Hispano to buy ABN and carve it up. It has been widely speculated that other suitors would be willing to pay more than Barclays - especially in the event of a breakup bid.

While ABN management may not be too enthusiastic about these additional bids, a bidding war is certainly in the best interest of shareholders as evidenced by today's jump. We know that one activist investor, The Children's Investment Fund, already announced that it would support the consideration of the RBoS consortium saying: "As ABN Amro shareholders, we believe that the fiduciary duties of the supervisory and management boards require that the Royal Bank of Scotland consortium is allowed to proceed immediately with due diligence on a basis equivalent to Barclays for there to be a fair and transparent process which maximizes shareholder value". Clearly the situation makes ABN a stock worth watching!

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Monster Worldwide Inc. (NYSE:MNST) shares rose over 3% today after the company announced that Sal Iannuzzi would replace William Pastore as Chairman and CEO of the company in the second management shakeup in six months. The CEO switched has led to speculation that Monster may be interested in putting itself back on the block, especially given Iannuzzi's past roles in high profile deals.

Many analysts believe that if the company did put itself up for sale, it could potentially be a target for Yahoo! or eBay who are looking to take market share from Google in areas outside of search. The company could also be a target for newspaper chains or private online recruiting companies like CareerBuilder.com. Given the company's strong market position, solid financial performance, and large number of potential bidders, many analysts are predicting that the company could see more than $60 per share or almost 20x projected 2007 EBITDA. While no deal is certain, there is definitely a possibility for M&A in what has become a strange story on Wall Street. This makes MNST a stock worth watching!

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Motorola, Inc. (NYSE:MOT) board members may face some opposition at the company's next annual meeting after Carl Icahn filed a proxy statement soliciting shareholder votes to elect him to the Motorola board of directors. In his letter to shareholders, Icahn commented that his experience tells him that Motorola's problems reflect not only operational failures, but also symptoms of a passive and reactive board. The move comes after the company's surprise fourth-quarter drop in earnings for its Mobile Devices segment and recently announced expectations for disappointing results through 2007.

Shares did not rally on the news, however, since Icahn added that buy-backs and other transactions that might have looked appropriate earlier need to take a "back seat". It was his recommendations to unlock value through such transactions that helped move the stock significantly during his past announcements. In the end, it may be best for the company to concern itself with improving its operational performance before exploring any strategic options, despite the fact that it may take some time. Meanwhile, this is definitely a stock to watch as the situation unfolds!

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Google Inc. (NDAQ:GOOG) announced Friday that it has agreed to buy online-advertising company DoubleClick Inc. for $3.1 billion in cash, capping takeover talks that reportedly featured interest from other companies including Microsoft. The acquisition will help Google boost its efforts to sell more graphics-based display ads - a market pioneered by the venture-funded DoubleClick.

Merck & Co. (NYSE:MRK) shares jumped on Friday after a greatly improved 2007 earnings forecast hit the markets as well as the dismissal of a class-action lawsuit filed by shareholders over its handling of the recalled Vioxx. There were also rumors that a Texas judge is poised to throw out a key Vioxx case, which could derail another 1,000 Vioxx cases filed in Texas courts.

eBay Inc. (NDAQ:EBAY) is expected to report higher sales and a surge in profit on Wednesday, fueled by growth in its PayPal division and improving selling prices of items sold on its website. Sales are projected to climb 22% to $1.7 billion while profits are expected to come in at 30 cents per share - the higher end of eBay's guidance.

McDonald's Corp. (NYSE:MCD) shares added 2.2% after the company said it expects earnings of 62 cents for Q1, including a one cent gain from foreign currency translation. This tops analyst estimates of 57 cents.

Apple, Inc. (NDAQ:AAPL) shares fell over 2% after the comany said it would delay the release of Leapard, the next upgrade of its Mac operating system, until October.

Comverge (NDAQ:COMV) shares jumped over 16% on their first day of trading on the Nasdaq. The maker of software and related technology is tapping into the so-called "Cleantech" sector aimed at reducing the world's carbon footprint by making electricity transmission grids smarter.

General Electric Co. (NYSE:GE) rose 0.6% after the company's first quarter results came in line with analysts' expectations, while it also reaffirmed its earnings guidance for 2007.

Sirius Satellite Radio Inc. (NDAQ:SIRI) and XM Satellite Radio Holdings Inc. (NDAQ:XMSR) advanced slightly after the Justice Department said it had requested more information on their planned merger.

Dow Chemical Co. (NYSE:DOW) shares moved up $1.23, or 2.73%, to $46.32 today after the company announced that it had fired two longtime executives, including the company's former finance chief, who it said were involved in unauthorized discussions with third parties about the potential acquisition of the company. Dow said it learned of the misconduct on Tuesday and its board was informed on Wednesday. The news comes after rumors of a $50 billion leveraged buyout surfaced in a British tabloid newspaper, the Sunday Express in London, earlier this week. While the company immediately discounted the report and voiced its opposition to a buyout, shares still rallied up 7% on Monday and a further nearly 3% today. Clearly, this event makes the story more interesting and the possibility of something happening behind the scenes more likely. However, given Dow's resistance to any buyout, it is not likely that any deal will be closed for quite some time. So, while this may be a stock to watch, it may be too early to take any action.

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MedImmune Inc. (NDAQ:MEDI) shares moved up $4.75, or 12.55%, to $42.59 after the company announced that they hired Goldman Sachs to explore strategic alternatives. The company noted that indications of interest by major pharmaceutical companies, coupled with recent expressions by certain stockholders of dissatisfaction with the company's short-term stock price performance, have led to the board to authorize management to gather information regarding a possible strategic interest in acquiring the company. This dissatisfaction was expressed by 1.2% holder Carl Icahn who holds almost 2.8 million shares in the company. The move again demonstrates the increasing power that activist shareholders can have in unlocking value within a company! Investors should also watch MEDI closely as any buyout would likely come at a healthy premium!

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Nasdaq Stock Market Inc. (NDAQ:NDAQ) is reportedly seeking a deal with the Philadelphia Stock Exchange after its unsuccessful cross-border deal with the London Stock Exchange fell through. A PHLX acquisition would give the NDAQ a strong presence in the rapidly expanding options business. A Wall Street Journal story reported on April 11th that the exchanges have been in talks for months and though no merger news is expected immediately, a deal could be just several week away, citing unnamed sources familiar with the matter. Meanwhile, the CBOT vs. CME vs. ICE buyout battle continues to wage while the NYSE and Euronext merger appears to be all but locked up. Clearly, there is a lot of action going on now amongst the exchanges, which makes them a sector worth keeping a close eye on!

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AVP Inc. (OTC:AVPI) shares moved up $0.06, or 4.8%, to $1.30 today after Diker Management disclosed a 15.8% stake in the company and expressed its concerns over AVP's proposed below-market-price sale of the company. AVP agreed to be acquired by Shamrock Holdings for $1.23 per share, which is significantly below the intrinsic value of the company and a staggering 18% below the prior day's closing price of $1.50! This is almost unheard of in the world of M&A where buyouts typically come at substantial premiums to both the current market prices and 20-day moving averages.

Diker insisted that AVP's future prospects appear very bright. The company's 2006 Form 10KSB said that its revenues grew 38% in 2006 while its gross profit expanded by 80%. Net loss decreased significantly from an $8.96 million loss to nearly breaking even with a $0.34 million loss. Excluding one-time expenses such as the administrative costs while raising money and a redesign of the company's logo, AVP would have been significantly profitable in 2006. The hedge fund said that it expects the company to report strong positive net income of $3 to $4 million in 2007 and substantially higher numbers in 2008. They support this notion by pointing to (1) signed or renewed sponsorship agreements with McDonald's, Hilton, Shick, Nature Valley, and Banana Boat, (2) a schedule of at least 18 events for 2007, up from 16 in 2006, (3) and plans on further reducing operating expenses while expanding revenues.

So, what is the company really worth? AVP is a lifestyle sports entertainment company that focuses on live and televised professional beach volleyball events. The company offers a well positioned business model that compares to Speedway Motors (NYSE:ISCA), World Wrestling Entertainment (NYSE:WWE), and Dover Motorsports (NYSE:DVD). The proposed acquisition of AVP values the company at an enterprise value of $31.8 million, or 1.48x trailing 12 months revenue. The peer group mentioned above trades at an average and median of 3.1x trailing 12 months revenue. This suggests a valuation of $2.38 per AVP share. Moreover, the peer group trades at a median of 9.2x 2008 EBITDA consensus. Applying this multiple to AVP again yields a dramatically higher number - especially if you take into account the fact that the acquirer will be able to remove public company costs!

What can be done? Obviously, shareholders can reject the proposal which is definitely a possibility given Diker's 15.8% stake and the sub par buyout offer. However, for now, the hedge fund is appealing to the company's board of directors to reconsider the proposed offer in hopes that they will repeal it. If they are successful in either of these, we could see a substantially higher buyout offer, or the company remaining a separate entity. Either way, this stock is definitely worth watching!

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NovaStar (NYSE:NFI) announced that it hired Deutsche Bank to help it explore strategic alternatives including a possible sale or other "change of control transaction". The move will make it the latest subprime mortgage specialist to propose relinquishing its independence.

Research in Motion Ltd. (NDAQ:RIMM) said that its fiscal fourth quarter profits surged tenfold from a year ago, when it had a large legal expense, as sales rose 66% on higher demand for the company's BlackBerry wireless devices.

Google Inc. (NDAQ:GOOG) plans to join the battle to deploy voice-based search technology according to a media report on Wednesday. Google released a free experimental service last week called Google Voice Local Search, which allowed users to dial a number and search for businesses in specific cities via voice recognition.

Advanced Magnetics Inc. (NDAQ:AMAG) said its Phase III studies on ferumoxytol, an intravenous iron replacement, met their primary and secondary endpoints. The Cambridge, Mass.-based company said the two studies demonstrate a significant improvement in hemoglobin levels for non-dialysis dependent patients using the drug, compared with oral iron supplements.

CheckFree Corp. (NDAQ:CKFR) confirmed that it has had discussions with an unnamed "large customer" over the possibility of the customer "pursuing an in-house approach" for some of Checkfree's services. Atlanta-based Checkfree added that "there have been no changes to any material customer contracts." Earlier Wednesday, JMP Securities analyst David Scharf said he was fairly certain that Bank of America is planning to transition the payment warehouse portion of its online bill-pay processing to an in-house solution. Scharf said he believed BofA's business accounted for $170 million, or 20% of CheckFree's fiscal 2006 revenue, with bill-pay services accounting for $150 million.

Christopher & Banks Corp.'s (NYSE:CBK) fiscal fourth-quarter net income plunged to $1.93 million, or 5 cents a share, from $6.68 million, or 18 cents a share, a year earlier. The Minneapolis-based women's retailer said net sales for the 14-week quarter ended March 3 increased 5.8% to $134 million, compared with $126.6 million in the 13-week period a year ago. Christopher & Banks expects a first-quarter net income range of 30 cents to 31 cents a share.

Dot Hill Systems Corp. (NDAQ:HILL) said it now expects a first-quarter loss of 13 cents to 15 cents a share on revenue of $53 million to $54 million. The Carlsbad, Calif.-based provider of storage systems previously forecast a per-share loss of 20 cents to 23 cents a share on revenue of $46 million to $49 million. Dot Hill said the increased forecast is largely due to higher-than-expected revenue and margin contribution from its largest OEM customer.

TLC Vision (NDAQ:TLCV) shares move dup over 9% today after the company announced that it would repurchase $125 million worth of its own shares at prices not less than $5.75 and not more than $6.25. The repurchase was initially proposed along with other strategic alternatives by Glenhill Advisors and will be financed through a combination of cash and borrowing. The move also provides a healthy boost to Glenhill's position, which paid around $4 to $5 for its 14% stake in the company. This is yet another instance where shareholder activism caused change that helped the company unlock value in its shares! Meanwhile, shareholders are also watching the company as it embarks on larger changes that the hedge funds proposed to its overall strategy and restructuring. Combined, these factors make TLCV a stock worth following!

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Vonage Holdings, Inc. (NYSE:VG) shares dropped more than 10% this week after a federal court ruled Friday that the company stop signing up new customers in connection with a patent dispute with Verizon Communications Inc. (NYSE:VZ). The courts found in March that Vonage infringed on three of Verizon's patents, including those related to retrieving voicemail and terminating voice calls from someone using an Internet-based telecommunications network to a traditional network. While Vontage plan on appealing the ruling, concerns are mounting about the long-term viability of the non-profitable Vonage.

New customers are the lifeblood of telecom providers who typically record high customer churn rates. Vonage said in court that it loses about 50,000 customers per month, which means that in a year roughly a quarter of the company's customers could leave the company if it were prevented from adding new subscribers. In the end, patent infringement penalties, customer defection, and increased cost from workarounds could cause Vonage bond-holders to exercise a $250 million put on notes issued in December of 2005. If this put is exercised, the bond-holders could call for payment in December 2008 which could pose a significant problem for the company. Assuming that the put is exercised, the company could face a significant liquidity event if the bonds are repaid in cash or swapped equity. Combined, Vonage is looking at some serious problems that need to be addressed before a higher stock price can be justified. However, if the company can find its way out of this mess through an acquisition or court ruling, it would mean significant share appreciation over the short-term. This make VG a stock worth watching!

Embarcadero Technologies, Inc. (NDAQ:EMBT) shares rose more than 2% today after the company announced a definitive merger agreement with private equity firm Thoma Cressey Bravo in a transaction worth $7.20 per share, or $200 million, in cash. We first mentioned this company back in mid-March when the company has trading at around $6.60 per share, representing a 9% gain in under one month! Chapman Capital had been pressuring the company to put itself up for sale in order to unlock shareholder value. The hedge fund that averaged in the low $6 range said it would support the transaction. eSpeed Inc. (NDAQ:ESPD) is another company that the hedge fund is currently targeting as a potential buyout target.

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Pier 1 Imports, Inc. (NYSE:PIR) shares moved down marginally after Elliott Associates and Elliott International disclosed a 5.5% stake in the company and expressed their concerns over the company's pace of cost-cutting and restructuring actions over the past two years. In a letter to the company, the hedge fund said that the company should "right-size" itself by closing down a significant number of stores, lease part or all of the corporate headquarters, and add new independent members to the company's board of directors. If executed properly, Elliott believes that this strategy will yield immense value to shareholders by creating a leaner, profitable company to better compete in the future.

The hedge fund believes that the Pier 1 should close down a significant number of stores because the company operates significantly more stores than its home furnishings retail competitors in a business that they believe will begin to scale back soon after a rapid expansion between 2000 and 2006. Moreover, Elliott believes that the company's recent accelerated expansion has led to significant levels of cannibalization and a meaningful number of highly unprofitable stores. Consequently, the hedge fund recommends closing around 250 to 300 underperforming stores as quickly as possible, returning their store count to no more than 1,000 stores.

Elliott is also concerned about the company's growing expenses. They noted in their letter than as Pier 1's store count has grown, so has its level of SG&A expense. Since 2002, SG&A expenses have increased 43% while the company's top-line has only grown seven percent. By reducing the company's store count, Elliott believes that the company will be able to reduce their SG&A expenses to 2002 levels while lowering their expenses as a percent of sales.

Finally, the hedge fund concluded its letter by recommending that the company add new independent directors to its board to assist in a turnaround. While they did not recommend any specific directors, they are likely seeking to simply add members that would be willing to pressure the company to implement any turnaround changes more quickly that the current pace. Overall, this company is definitely one worth watching - if any of these changes are implemented, it could mean significant share appreciation over the medium to long term.

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The Dow Chemical Company (NYSE:DOW) shares moved up $2.63, or 5.91%, to $47.10 in early trading today after takeover rumors surfaced in the London's Sunday Express. The British tabloid reported that Middle Eastern investors have put a package together with U.S. buyout firm KKR in what would be a $52 to $58 per share bid. KKR would reportedly put up half of the bid with investors from Saudi Arabia, Kuwait, Bahrain, Qatar, United Arab Emirates and Oman would put up the rest.

The company declined to comment on the rumors, but noted tha this is a follow-up to a report by the same newspaper in London that was widely dismissed by industry analysts as lacking any substance. The first rumors came back in February, when the Sunday Times reported that private investors were interested in bidding for the company in a deal that could be worth up to $60 per share. Analysts both now and then note that any unsolicited deal for Dow would likely be treated as very hostile by management as a breakup of the company wouldn't make much sense given the company's stated strategy. So, while the situation may be worth watching, take this optimism with a healthy dose of reality!

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Dell Inc. (NDAQ:DELL) said it received a Nasdaq non-compliance notice after delaying its Form 10-K filing with the SEC for the year end February 2nd. The company announced last week that it wouldn't file its annual report on time because it hasn't finished an internal investigation into its past accounting practices.

Dow Chemical Co. (NYSE:DOW) said that it still has no interest in a leveraged buyout, discounting the latest unsourced media report saying that a group of PE firms and investors were close to announcing a $50 billion buyout offer.

Marathon Oil Corp. (NYSE:MRO) said its first-quarter refining and wholesale marketing margins will be flat vs. last year, despite stronger market indicators for the refining sector in the U.S. Gulf Coast and the Midwest. In an interim earnings report, Marathon said the types of crude its refineries process are being priced at a wider premium against West Texas Intermediate crude delivered at Cushing, Okla.

Masco Corp. (NYSE:MAS) that Chairman and Chief Executive Richard Manoogian will transition from CEO to executive chairman in July. Manoogian has recommended to the board that Chief Financial Officer Timothy Wadhams become CEO in July, the Taylor, Mich.-based manufacturer of home improvement and building products. The board is expected to consider the recommendation in the next few months.

Mosaic Co. (NYSE:MOS) reported third-quarter net earnings of $42.2 million, or 10 cents a share. During the same period a year ago, the company posted a net loss of $71.6 million, or 19 cents a share. There were 440.9 million shares outstanding during the quarter compared with 383.6 million last year. The Plymouth, Minn.-based producer of concentrated phosphate and potash crop nutrients reported revenue of $1.28 billion, up 19% from $1.07 billion. The results include an after-tax gain of $21 million, or 5 cents a share, on extinguishment of debt.

New York & Co. (NYSE:NWY) signed an exclusive agreement for Inter Parfums Inc. (IPAR) to design and manufacture a line of personal care products. New York & Co. hopes the line of products will increase market penetration, and expects this project to increase items per transaction and grow sales in a high-demand category.

Northfield Laboratories Inc. (NDAQ:NFLD) reported a third-quarter net loss of $6.1 million, or 23 cents per basic share, compared with a net loss of $6.4 million, or 24 cents per basic share, during the year-ago period. As a development stage company, the Evanston, Ill.-based biotechnology company doesn't generate revenue.

99 Cents Only Stores (NYSE:NDN) late Monday said fourth-quarter same-store sales rose 2.9% from the year-ago period, as total sales rose 9.4% to $277.9 million. Retail sales for the quarter ended March 31 were $267.2 million, up 9.2%, the City of Commerce, Calif.-based company said.

Cascade Corp. (NYSE:CAE) reported fiscal fourth-quarter net income rose 24% to $10.2 million, or 80 cents a share, from $8.27 million, or 63 cents a share, a year earlier. The Fairview, Ore., manufacturer of forklift parts said revenue for the quarter ended Jan. 31 rose 9.7% to $118.9 million from $108.4 million a year ago.

Chordiant Software Inc. (NDAQ:CHRD) forecast fiscal second-quarter earnings of 11 cents to 16 cents a share on revenue of $31 million to $33 million. Analysts polled by Thomson Financial are expecting, on average, a per-share profit of 3 cents on revenue of $26.5 million.

DivX Inc. (NDAQ:DIVX) said it expects fiscal first-quarter revenue and pre-tax earnings to come in above its previous forecast. The San Diego-based company now expects revenue of $19.8 million to $20.2 million and for pre-tax earnings to be flat to up sequentially. DivX had previously forecast first-quarter revenue of $17.3 million to $19.3 million and for pre-tax earnings to be flat to slightly down when compared with the fourth quarter.

Pioneer Natural Resources (NYSE:PXD) jumped nearly 10% on Wednesday amid speculation that the company will spin off some of its assets in an effort to boost their stock price. The rumors took off after the company announced that it would consider creating a Master Limited Partnership - or MLP - for some of its exploration and production assets. Many analysts believe that a spin off has the potential to unlock significant value and raised their price targets for the company.

Spin offs not only provide the parent company with excess cash, but the new entity also provides a great opportunity as spin offs generally outperform the overall market during their first year. The excess cash at the parent company can then be used for share buybacks, special dividends, or other methods to unlock shareholder value. While no definitive announcement has been made, this is definitely a stock worth watching as any spin off could mean significant share appreciation for PXD shareholders!

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Borders Group Inc. (NYSE:BGP) reneged on its plans to sell $250 million in convertible bonds less than a day after it proposed the sale. The book retailer announced that it would "re-evaluate this and other financing alternatives" after a large shareholders supposedly raised objections because it would hurt existing shareholders. However, sources close to the situation say that the real reason is that more convertible debt could jeopardize a possible sale of the company.

Speculation of a sale come as the company unveiled a restructuring plan after reporting disappointing numbers for the year. As part of the plan, the company said it intends to sell or franchise most of its overseas stores and expedite teh closing of many Waldenbooks outlets throughout the U.S. Many analysts see this move to unload under performing businesses as a preliminary step ahead of a possible sale of the company. In fact, some investors have already been pushing for a sale of the company to its closest rival, Barnes & Noble (NYSE:BKS), after Bill Ackman's Pershing Square took big positions in both companies. While Barnes & Noble executives have dismissed these rumors, Ackman still holds a 12% stake in the company as of April 4th. Meanwhile, there has also been speculation that the private equity firms have been eyeing the company. Today's developments definitely give more merit to these rumors, however whether or not they are true remains to be seen. Regardless, this is definitely a stock to watch!

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Flow International Corporation (NDAQ:FLOW) shares moved up $0.26, or 2.39%, to $11.16 today after Daniel Loeb's Third Point disclosed a 13.6% stake in the company and expressed its disappointment with the company's board of directors. In particular, Loeb was concerned with the company's lack of response to his February 2nd call to retain, and publicly disclose, a well-recognized investment bank to assist the company in putting itself up for sale.

Several members of the company's board and management flew to New York to meet with Third Point; however, very little has been done since. Mr. Loeb is now demanding that the company retain a publicly identified and well recognized investment bank, with a clear mandate to explore strategic alternatives including a sale of the company. Further, the hedge fund insisted that the company comply with best practices in corporate governance by repealing its poison pill and de-staggering the election of its board. Finally, Loeb warned the company not to make the same mistake other have made by under-estimating his resolve in this matter - we know that Loeb is not at all adverse to replacing members of the board via a proxy fight. This makes FLOW a stock worth watching as any sale of the company would likely come at a healthy premium to the current market price!

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Regent Communications, Inc. (NDAQ:RGCI) shares rose marginally after Riley Investment Management disclosed a 6.5% stake in the company and sent a letter to the company's board demanding that Regent put itself up for sale. Riley reasoned that the valuation of the company's shares has been hurt by negative public sentiment to the terrestrial radio broadcasting market while the expenses of being a public company has been an excessive burden to the company given their size. Consequently, the hedge fund recommended that the company put itself up for sale, suggesting that a financial buyer could pay around $4.50 per share while a strategic buyer could pay as much as $6.00 per share - a 100% premium to the current market price. Given the company's recent slide and poor earnings, this alternative would seem to be in the best interest of shareholders. This makes RGCI a stock worth watching!

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DaimlerChrysler AG (NYSE:DCX) shareholders urged the company to sell its unprofitable Chrysler unit and focus on its Mercedes Car Group and other operations at the company's annual meeting yesterday. The company had already said that it was considering all strategic options for Chrysler in February, after the unit posted a $1.5 billion loss in 2006. Since then, the DC said they would cut 13,000 jobs and reduce capacity by 400,000 units as part of a "recovery and transformation plan" to bring the unit back to profitability by 2008. However, this plan drew criticism from shareholders who said the feasibility of a sustainable business model for Chrysler remains unclear.

DaimlerChrysler CEO Dieter Zetsche did confirm Wednesday, however, that the company was in talks with "potential partners" over the future of its business. While he did not go into specifics, he did note that these potential partners showed a claer interest in the company. Private equity firms Cerberus, Blackstone, and Centerbridge are also rumored to be interested in acquiring a stake in Chrysler as the first round of bids was expected to be submitted last week. However, labor representatives on both sides of the ocean will likely oppose such a deal due to fears over further job cuts and the loss of employee benefits. If a sale does take place, many analysts peg the value of Chrysler at $5 billion to $9 billion, depending on the terms of the deal. Combined, these factors make DCX a stock worth watching!

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YouBet.com, Inc. (NDAQ:UBET) shares moved up $0.04, or 1.27% to $3.20 today after New World Opportunity Partners disclosed a 9.3% stake in the company in a Schedule 13D filing with the SEC. The hedge fund also said that it has discussed YouBet.com's business operations, future plans and board makeup with its management and directors. While we do not know the nature of these discussions at this point, New World did express interest in nominating its own director to replace Jay Pritzker depending on share price and industry conditions. The hedge fund also said it mat propose changes to UBET's capitalization, ownership structure, or operations. The company's stock has fallen from a 52-week high of $5.47 in May 2006 to a low of $2.32 before rebounding to its current levels. Still off 14%, the stock could well be the target of some restructuring moves in order to reduce costs and enhance profitability. This makes UBET a stock worth watching, particularly if New World decides to pursue board seats!

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Idaho General Mines Inc. (AMEX:GMO) shares rose nearly 10% during the past two days after Coghill Capital Management disclosed a 27.42% stake in the company and brought some possible business combination transactions to management's attention. The hedge fund also delivered a letter to the company's board that discusses the importance of good corporation governance and asked the company to develop a plan which will enable the it to achieve the highest quartile of corporate governance within the next six months. While no further details were given, the idea of possible business transactions is certainly something worth noting as the typical buyout premiums have hit approximately 4.6x target sales. Moreover, with a 27% stake in the company, Coghill certainly has the power to influence the company's decisions significantly! Combined, these factors make GMO a stock worth following.

Comcast Corporation (NDAQ:CMCSA) agreed to acquire cable-television provider Patriot Media for $482 million in a deal that would give Comcast cover in the central New Jersey area. The privately held company has 81,000 video subscribers in several NJ counties and the acquisition brings Comcasts total number of subscribers to around 24.2 million. Interestingly, the deal also comes only a day after Comcast and Insight Communications Co. announced plans to divide up Insight - a midsize cable operator that jointly serves about 1.3 million subscribers in the Midwest. That deal is valued at around $6.2 billion, including the assumption of debt. Earlier this year, there was also an attempt by the Dolan family to take Cablevision private at $30/share in a deal valued at around $8.9 billion; however, the company's board rejected the offer as being too low.

These recent moves indicate a further push towards cable industry consolidation as larger operators try to expand their customer base. Acquisitions make sense for these large operators since they are able to utilize economies of scale to lower costs and improve the profitability of smaller acquisitions. Moreover, there is constant competition for these networks to keep growing in order to remain competitive with their peers. And the M&A trend will only grow stronger as cable industry multiples remain near all-time lows.

So, what are some other cable names to look out for? Here's our shortlist of possible future deals in this industry:

• Cablevision Systems (CVC) - There was already an attempted takeover of this company, so we know it is an attractive target. Many analysts believe that this it the next big cable buyout, whether by private equity or a public merger.
  
• RCN Corporation (RCNI) - Shares have dropped almost 15% so far this year, if they head lower it could become a target.
• Knology (KNOL) - This is a strong company with a good presence in several southern US markets.

For other potential buyout targets, check out the Google Finance Broadcasting & Cable TV Sector Listing. While mega-deals like Cablevision may be a distant target, it is likely that we will continue to see at least some consolidation among smaller providers while multiples remain at low levels. These stocks are definitely worth keeping an eye on!

The NYSE Group Inc. (NYSE:NYX) will take its biggest step Wednesday toward becoming a truly global financial player when it closes a deal to create the first trans-Atlantic stock market. The New York Stock Exchange consummates its $11 billion takeover of Paris-based exchange operator Euronext NV at ceremonies in the U.S. and Europe. The combination into NYSE Euronext forms the world's biggest stock market, and ushers in a new era for financial markets where securities can be traded on two continents up to 12 hours a day. It will be a crowning achievement for John Thain, the former president of Goldman Sachs Group Inc. who became chief executive of the now 215-year-old NYSE in 2004.

Shares of some of the largest health insurers rose Tuesday after the government announced higher-than-expected payment increases for companies that operate private Medicare plans. The Centers for Medicare and Medicaid Services said late Monday that preliminary payments to companies that run Medicare Advantage programs will rise 3.5% for 2008. The payment boost, made to insurers for each Medicare participant they cover, is less than last year's 3.9% update, but above Wall Street estimates of a 2% to 3% increase.

Humana Inc. (NYSE:HUM), stock rose $2.11, or 3.6% to $61.16 Tuesday on the NYSE. In after-hours trading, shares rose another $0.16 to $61.32. Competitor Wellcare Health Plans Inc., which makes a quarter of its revenue from Medicare Advantage, rose $1.93, or 2.2%, to $88.77. Shares of UnitedHealth Group Inc. rose $0.88 to close at $54.61, while shares of Aetna Inc. were up $0.64 to $44.83, both on the NYSE. Shares of Coventry Health Care Inc. rose $1.10 to close at $58.04 on the NYSE.

The best monthly sales performance ever for Toyota and gains by fellow Japanese automakers Honda and Nissan helped the industry in March top last year's best month for U.S. sales despite declines by GM, Ford and DaimlerChrysler. Toyota's U.S. sales jumped nearly 12% in March compared with a year ago, boosted by record hybrid sales and strong overall car sales. The overall rise in U.S. sales came despite GM and DaimlerChrysler's sales falling about 4% each, and Ford posting a 9% drop.  

Marshall & Ilsley Corp. (NYSE:MI) plans to spin off its data processing arm into a stand-alone publicly traded company in a $4.25 billion deal involving a New York private equity firm, M&I said Tuesday. Warburg Pincus, a New York City global private equity firm will invest $625 million to purchase 25% equity in Metavante Corp. M&I shareholders will own the remaining 75% of Brown Deer-based Metavante. The deal is tax-free. M&I shareholders will receive one share of M&I stock and one share of Metavante Corp. stock for every three shares of Marshall & Ilsley Corp. stock held. Shares of M&I jumped $3.97, or nearly 9% to close at $49.83, after the Wall Street Journal reported that a $4 billion spinoff was in the works Tuesday morning.

Google (NDAQ:GOOG) shares rose Tuesday after the Web search company said that it will start selling and choosing some ads broadcast to EchoStar Communications Corp.'s 13.1 million satellite TV subscribers. Google shares gained $14.07, or 3.1%, to close at $472.60 on the Nasdaq Stock Market. During the past year, the stock has traded between $360.57 and $513. Mitchell also noted that OpenTV is EchoStar's largest technology provider, and that the company also has a relationship with Google, since its founder joined Google last year as head of television technology. EchoStar shares gained $0.50 to close at $44.04 on the Nasdaq. The Rentrak Corp., which sells business intelligence software for tracking entertainment sales data, could benefit from the contract because it can give advertisers real-time measurement data that is better than conventional statistical sampling processes. The company has 42 million set-top boxes across the country. Rentrak shares gained $0.37, or 2.4%, to close at $15.82 on the Nasdaq. Additionally, shares of OpenTV Corp., which may be another beneficiary of the deal, gained $0.09 or 3.6%, to close at $2.61 on the Nasdaq. The shares have ranged from $2.27 to $4.18 over the past year. OpenTV provides software for cable and satellite television.

Pozen (NDAQ:POZN), which is developing Trexima with GlaxoSmithKline PLC, said that Trexima worked better than drugs sumatriptan or naproxen sodium when used alone. The results were also published in the Journal of the American Medical Association. Shares of Pozen rose $1.08, or 7.6%, to $15.30 in extended trading, after rising $0.24, or 2%, to finish at $14.22 on the Nasdaq Stock Market.

FSI International, Inc. (NDAQ:FSII) shares have moved up over 7% since late last week when Chapman Capital disclosed a 6.5% stake in the company and expressed his increasing concern over the apparent divergence between ownership and management of the company in a Schedule 13D filing with the SEC. Specifically, Mr. Chapman was appalled that in approximately 75% of the fiscal quarters comprising FY2000 through FY2006 the company had reported net losses while CEO Benno Mitchell received millions of dollars in compensation. The hedge fund manager was also concerned by the fact that the CEO ran the company from the comfort of his own home. This concern was heightened when Mr. Mitchell's wife answered the telephone at Mr. Mitchell's primary place of conducting business! Since then, no telephone calls have been returned as the company continues to avoid contact with its shareholders. Consequently, the hedge fund said that they plan to solicit interest in acquiring the company by prospective strategic buyers and plan the recruitment of alternative management and corporate governors for the company. If there is significant interest in the company by other players in the semi-conductor industry, FSII shareholders could see significant upside as cost cutting could greatly enhance the profitability of this company. This makes FSII a stock worth watching!

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Tribune Company (NYSE:TRB) shares moved up 2.65% today after the it agreed to Sam Zell's $8 billion buyout offer, making the end of a six month auction process. Under the terms of the deal, Zell will investment $315 million in equity, which will be largely held through an employee stock ownership plan or ESOP. Meanwhile, Zell will retain a subordinated note and a warrant enabling him to acquire 40% of Tribune's common stock. The company also agreed to sell the Chicago Cubs and 25% of its Comcast SportsNet Chicago interests to pay down debt after the 2007 baseball season. Tribune's chairman, president and CEO Dennis FitzSimons said, "As a private company, Tribune will have greater flexibility to transform our publishing/interactive and broadcasting businesses with an eye toward long-term growth."

How is this entire deal going down? Well, first there will be a cash tender offer for around 126 million shares at $34 per share, funded through loans and a $250 million investment from Zell. This initial tender offer is expected to be completed by June. Then the company will implement a merger agreement in which Tribune and the ESOP will merge and all remaining Tribune stock will be converted to cash at $34 per share. The entire process is expected to close in the fourth quarter of this year, marking an end to the lengthy and heated Tribune auction process.

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The Brink's Company (NYSE:BCO) is again under pressure from dissident shareholders to unlock value through a strategic transaction. MMI Investments disclosed an 8.3% stake in the company today and recommended that the company pursue a tax-free spin-off of one of BCO's two business segments to create value for shareholders. MMI, along with other shareholders, believe that Wall Street has perpetually undervalued the combined enterprise despite all the changes of the past few years, BCO's premier brands, and its best in class operating model in both monitoring and cash-in-transit. Based on a sum-of-the-parts analysis, MMI believes that the potential value to be created via a tax-free spin-off could mean a $79 per share valuation - a 25% premium to the current stock price.

MMI Investments believes that a spin-off is the best option since the move would align the company with the increasingly specialized comparables universe (ie. Securitas Direct, Protection One, Loomis, Tyco) and enable the company to retain tax-free treatment without inhibiting other value-enhancing options. The hedge fund also believes there are several business reasons for the spin-off, including;

• BHS and Brink's have different cash flow and capital investment requirements
• Both entities would benefit from separate access to equity and debt capital markets
• Potential for a higher valued equity currency to compete in the highly competitive M&A market
• Management of each entity would have the opportunity to focus exclusively on their distinct businesses
• Employees could be incentivized through stronger equity compensation plans more closely aligned to the performance of their business

Indeed, the company's 10K already suggests that BHS and Brink's Inc. are two separate subsidiaries, while the two entities do not even share facilities in any significant way. Moreover, if the spin-off were to take place, the two resulting companies would both have market capitalizations of approximately $1.5 billion or greater - more than enough for public company critical mass. So in the end, there is little reason not to pursue such a strategic transaction, as it would greatly enhance shareholder value and provide the company with greater flexibility. Combined, this situation makes BCO a stock worth watching!

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Credit card transaction processor First Data Corp. (NYSE:FDC) said that it is being acquired by an affiliate of private equity firm Kohlberg Kravis Roberts & Co. for about $27 billion, which would be among the richest ever private takeover offers in the U.S. The proposed deal comes amid a flurry of activity by buyout groups to take public companies private. KKR has offered $34 a share for First Data, a premium of about 26% over First Data's closing price last Friday.  First Data shares rose $5.55, or 21%, to close at $32.45 Monday on the NYSE after briefly rising to a 52-week high of $32.90. It has about 754 million common shares outstanding which would be worth $25.6 billion at the offered price. In addition, the company said unvested stock options and restricted stock awards that would vest upon a takeover would add about $1.4 billion to what the buyer would pay for First Data stock, boosting the deal's value to about $27 billion.

Real estate mogul Sam Zell won the battle of the billionaires Monday, landing media conglomerate Tribune Co. (NYSE:TRB) after a down-to-the-wire bidding war. Even with the buyout's $8.2 billion price tag, the outlook for the nation's second-largest newspaper publisher remained as uncertain as it did six months ago when it began a strategic review to boost a lagging stock price. A big chunk of new debt also will be required to pay the $34 a share cash buyout. Zell is counting on repaying the debt largely through tax benefits from a new employee stock option plan that would supplement existing retirement accounts for the company's 20,000 workers. Aside from selling the Chicago Cubs baseball team and its stake in Comcast SportsNet, Zell and Tribune executives were mum about prospects for the rest of the company's assets, including 23 television stations and nine newspapers ranging in size from the Los Angeles Times and the Chicago Tribune to the Daily Press in Newport News, Va. that will remain after two papers in Connecticut are sold. The buyout will be conducted as a two-part deal, the company said. The first stage, expected to be completed in the second quarter, will involve a cash tender offer of $34 per share for 126 million shares, more than half of the outstanding Tribune shares. The remaining shares will be purchased later at the same $34 per share price. Tribune has about 240 million shares outstanding, according to a regulatory filing.

New Century Financial Corp. (OTC:NEWC), once the nation's second-largest provider of home loans to high-risk borrowers, filed for bankruptcy protection on Monday, the victim of its own financial missteps as well as pressures felt by its rival lenders. New Century immediately fired 3,200 workers, more than half of its work force, and said it intends to sell off its major assets.

Citibank, the retail banking arm of Citigroup Inc. (NYSE:C), said Monday it's starting a mobile banking service that customers can download to their cell phones. The service, Citi Mobile, will be introduced first in Southern California and should be available throughout the United States by midyear, bank executives told a news conference in New York. Citi joins other U.S. financial institutions that are rolling out wireless banking applications. New York-based Citigroup, the nation's largest financial institution, sees the new service as yet another channel for customers to use for their banking, beyond the Internet bank Citibank Online, automated teller machines and the Citi call center operations.

M&T Bank Corp’s (NYSE:MTB) stock dropped 8.5%, or $9.88, to $105.95, after it said late on Friday that problems in mortgages with limited income documentation would hurt results.

Sun Microsystems (NDAQ:SUNW) shares declined 3.5%, or $0.21, to $5.80 after Sanford C. Bernstein lowered its rating on the company's stock, saying fiscal Q3 results could be disappointing.

US phone company AT&T Inc. (NYSE:T) said it and Mexican cell phone operator America Movil were in talks to buy stakes in the company that controls Telecom Italia for about $6.4 billion. AT&T shares ended up $0.03 at $39.46.

Starwood Hotels & Resorts Worldwide Inc. (NYSE:HOT) rose $2.97, or 4.6%, to $67.82, after announcing Steven J. Heyer has resigned as chief executive and a director after the company's board lost confidence in his leadership. The company also reaffirmed its first-quarter and full-year guidance.

Apple Inc. (NDAQ:AAPL) shares rose $0.74 to $93.65 after it reached an agreement with EMI Group PLC to sell the record label's songs online without copy protection software. However, the deal did not include The Beatles catalog.

Automatic Data Processing (NYSE:ADP) announced late Friday that it has completed the spin-off of its brokerage services group via a tax-free distribution to its shareholders. ADP said its shareholders would receive one share of the new Broadridge stock for every four shares of ADP stock that they own. The new stock will trade on the NYSE under the symbol "BR" beginning on Monday.

Atria Group (NYSE:MO) announced that it had completed its spin-off of Kraft Foods Inc. (NYSE:KFT) to Altria's sahreholders. The distribution of Altria's 88% stake was made on Friday to shareholders on record as of March 16th. Altria shareholders received 0.69 shares of Kraft for every share of Altria common stock held.

M&T Bank Corp. (NYSE:MTB) said trouble in its subprime residential mortgage unit will reduce its first-quarter net income to $1.50 to $1.60 a share compared to an original estimate of $1.86 per share. First-quarter profits will be cut by $7 million, or 7 cents per share, as a result of a $12 million reduction in the carrying value of M&T's socalled Alt-A mortgage portfolio held for sale.

Interpublic Group of Cos. (NYSE:IPG) said it has been informed by Johnson and Johnson of its decisiont o review media planning and buying. Interpublic is one of J&J's media agencies and one of its larger clients.

Potlatch Corp (NYSE:PCH) said it has agreed to sell its 17,0000 acre hybrid poplar tree farm in Boardma, Ore., to a private-equity tree-farm investment fund for $65 million. The deal is expected to close in the second quarter of 2007. The company said that it expects to incur an after-tax book loss of roughly $33.5 million on the sale, which will be recorded in the first quarter of the year.

Walter Industries (NYSE:WLT) was featured positively in Barron's Online. The article stated that while results and earnings may be volatile, the company's free cash, expansion plans, and dividend should keep the fire alive for shareholders.

Dendreon (NDAQ:DNDN) shares more than doubled in value by Friday's close after a FDA advisory committee concluded that the company's novel, experimental prostate cancer drug Provenge was both safe and effective. Given the results, many analysts raised their price targets for the company to around $20 per share. Meanwhile, the stock currently trades at $12.93.

Beazer Homes USA (NYSE:BZH) said on Friday that it would review two lawsuits filed against the homequilder, one of which accuses the company of using practices that allowed unqualified borrowers to get loans to buy its homes, but said it believes both were without merit.

Cephalon (NDAQ:CEPH) said on Friday that US regulators were willing to approve the company's experimental new drug Nuvigil for exxcessive sleepiness, but will require the company to carry prominent warnings of a skin-rash danger.