Tesla rallies ahead of results; BlackBerry slumps

Twitter raises IPO price range to $23 to $25

Sue Chang and Saumya Vaishampayan

SAN FRANCISCO (MarketWatch) -- Tesla Motors Inc. (TSLA) gained on Monday ahead of its quarterly earnings announcement while BlackBerry Ltd. (BBRY) tumbled after it abandoned its effort to find a new owner, dragging shares down to levels not seen in more than a year.

Tesla shares rose more than 7%. The electric vehicle company is forecast to post earnings of 8 cents a share in the third quarter when it releases its report late Tuesday. Delivery of Tesla's Model S is likely to have hit 5,850 units in the quarter, above the company's estimate of 5,000, according to Craig Irwin, an analyst at Wedbush.

BlackBerry shares sank 16%. The smartphone company ditched its sales process, instead electing to receive a $1 billion investment via convertible bonds from Fairfax Financial Holdings Ltd. and other institutional investors, as well as replace its chief executive officer.

Twitter on Monday raised its IPO price to a range of $23 to $25 a share from $17 to $20. Twitter, one of the most anticipated tech IPOs since Facebook Inc. went public last year, is expected to trade on the New York Stock Exchange on Thursday.

Separately, the social-network company disclosed that it has been accused by International Business Machines Corp. (IBM) of infringing on at least three patents. IBM (IBM) proposed to resolve the situation through negotiations. Shares of IBM (IBM) rose 0.7%.

Trending Tickers

$JCP: J.C. Penney Co. (JCP) shares gained 3.2%. Analysts at J.P. Morgan initiated a "Santa's Rally" long trade on the stock, suggesting that the retailer may be in the process of stabilizing, with the holiday season presenting an opportunity to recapture sales.

$BRKA $BRKB: Both Class A and Class B shares of Berkshire Hathaway Inc. were off about 0.5%. Warren Buffett's conglomerate on Friday reported third-quarter profit of $5.05 billion, or $3,074 a Class A share, up from $3.92 billion, or $2,373 a share, a year ago. Operating profit, which excludes certain investment results, increased to $2,228 a share from $2,057 a share.

$X: United States Steel Corp. (X) shares climbed 4.3%. Goldman Sachs analysts upgraded their view of the steel sector to neutral, in addition to upgrading specific companies. Among them, United States Steel (X) shares were lifted to a buy rating from sell, with analysts citing an improvement in its earnings and its cost-cutting efforts.

Shares of AK Steel Holding Corp. (AKS) jumped 9.1% on the more upbeat outlook on the industry. Analysts at Goldman Sachs also upgraded of AK Steel (AKS) to a buy rating from sell.

$CME: CME Group Inc. (CME) shares fell 1.4%. The exchange operator on Monday said its third-quarter profit rose to $236.7 million, or 71 cents a share, from $218 million, or 66 cents a share, a year ago. Excluding items, CME earned 75 cents a share. However, it reported revenue of $714.6 million and higher expenses which both missed the mark, said Daniel Fannon, an analyst at Jefferies.

$LINE: Shares of Linn Energy LLC (LINE) rose 2.7%. The company and its former Linn Co. LLC unit said an amended takeover agreement for Berry Petroleum Co. (BRY) has been approved by the three parties. Linn Co. agreed to raise the number of common shares it will issue to 1.68 per common share of Berry Petroleum (BRY) from 1.25 previously, boosting the value of the total deal to $4.9 billion, including the assumption of debt.

Gainers

Alcoa Inc. (AA) shares surged 6.9%. The aluminum company will host an investor day on Thursday, and executives are expected to provide more information on the company's business and strategies.

Vulcan Materials Co. (VMC) shares jumped 5.9%. The construction-material company on Monday said it earned 32 cents a share in the third quarter on adjusted basis, above the 27-cents-a-share projected by analysts.

TripAdvisor Inc. (TRIP) shares climbed 5.2%. The stock has been rising steadily since it reported third-quarter earnings last month.

Cliffs Natural Resources Inc. (CLF) shares gained 5.1%. Analysts at Nomura last week raised Cliffs's fiscal 2013 earnings per share outlook to $2.95 from $2.60, citing its strong third-quarter results.

Decliners

Nvidia Corp. (NVDA) shares dropped 3%. Analysts at Pacific Crest said the fair price for Nvidia's (NVDA) stock is $13 versus the current trading level of above $14. Any short-term benefit of higher margins from a recent product refresh will be short-lived due to weak PC demand, they said.

Avon Products Inc. (AVP) shares declined 2.9%. Last week, the beauty products company said the Securities and Exchange Commission and the Justice Department may propose significantly tougher settlement terms over their investigation into its alleged bribery practice in China and other countries. The agencies in June had rejected Avon's proposed $12 million settlement offer.

U.S.-listed shares of Ryanair Holdings PLC (RYAOF) skidded 9.6%. The budget airline based in Ireland cut its full-year outlook as the drop in average fares from the first half of the year is continuing much longer than expected. Ryanair (RYAOF) now expects full-year net profit of 500 million euros to 520 million euros, from an earlier estimate of 570 million euros to 600 million euros.


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