Monday's Stock Movers

MarketWatch's advancers and decliners worth watching:

Advancers

Alfacell Corp. (ACEL) reported positive in vivo and in vitro preclinical data that shows its Onconase drug inhibits tumor growth of non-small cell lung caner and breast cancer cells.

Amazon.com (AMZN) was upgraded to buy from hold at Deutsche Bank, as the broker sees potential for operating margin improvement in the near term and longer-term growth and margin expansion from the company's web services initiatives. The broker hiked its price target to $50 from $37. "While margin expansion has not been evident yet as of the most recent quarters, we think that margin expansion may be within sight for several reasons, including: easier comparisons shortly from the Toys 'R' Us contract termination last year, slowdown in technology and content spending, and most importantly the emergence of Amazon Web Services over the next six to eight quarters," the broker said.

Antigenics Inc. (AGEN) reported updated data from a Phase 1/2 trial of Oncophage, its investigational cancer vaccine, in recurrent, high-grade glioma. The company said the Oncophage vaccination was associated with significant tumor-specific immune response in all 12 treated patients from baseline (P less than .001), as determined using three separate immune response assessments.

Apollo Group (APOL) was upgraded to buy from neutral at Banc of America Securities. The firm, which cited valuation, also lifted its price target on the stock to $51 from $49.

Aquantive (AQNT) was upgraded to buy from neutral at UBS. The firm lifted its price target on the stock to $36 from $32, saying Google's purchase price for DoubleClick raises the value of Aquantive's ad serving business.

Ariad Pharmaceuticals Inc. (ARIA) sued Amgen Inc. (AMGN) and Wyeth, (WYE) alleging the two companies infringed its patents covering treatments regulating certain cell-signaling activity.

Boston Scientific Corp. (BSX) said the Food and Drug Administration has found the company's St. Paul, Minn., in compliance, and has lifted all restrictions associated with a warning letter issued for the site in late 2005. The St. Paul, Minn., plant is used to manufacture the company's cardiac rhythm management devices, which includes pacemakers and implantable cardioverter defibrillators, or ICDs. The plant was originally owned by Guidant Corp., which was bought by Boston Scientific for about $27 billion last year.

California Water Service Group (CWT) was upgraded to buy from neutral at Hilliard Lyons.

Citigroup (C) reported first-quarter profit slipped 11% to $5.01 billion, or $1.01 a share. The 2007 results include a charge of $871 million after tax related to a structural expense review. Citigroup last week unveiled a restructuring that would eliminate about 17,000 jobs worldwide and save the company an estimated $1.7 billion this year. Excluding the charge, net was $5.88 billion, or $1.18 a share. Analysts polled by Thomson First Call had expected the company to earn $1.09. See full story.

Eaton Corp. (ETN) said its first-quarter net income rose almost 13% to $234 million, or $1.56 a share, from $208 million, or $1.36 a share. Eaton, a Cleveland-based diversified industrial manufacturer, said sales in the three months ended March 31 rose 5% to $3.15 billion from $2.99 billion. Analysts polled by Thomson Financial forecast earnings, on average, of $1.41 a share and sales of $3.04 billion. Eaton forecast second-quarter net income at $1.35 to $1.45 a share and lifted its full-year net income outlook by 15 cents to $6.20 to $6.40 a share. Analysts polled by Thomson Financial forecast earnings, on average, of $6.22 a share for 2007.

Eli Lilly (LLY) reported first-quarter net income of 47 cents a share, compared with 77 cents in the year-earlier period. Earnings include charges associated with the acquisition of Icos Corp. and restructuring. Excluding the charges, adjusted net the quarter was $913.3 million, or 84 cents a share. Analysts polled by Thomson Financial, on average, expected first-quarter earnings of 79 cents a share. The Indianapolis pharmaceutical company said Monday that sales rose 14% to $4.3 billion. See full story.

EV Energy Partners LP (EVEP) agreed to acquire an interest in certain oil and natural gas properties in central and east Texas for about $100 million. The company is part of a group that has reached a deal to purchase the properties from Anadarko Petroleum Corp. (APC).

Fannie Mae (FNM) was upgraded to buy from neutral at Banc of America Securities. The firm said it expects the company to benefit from the credit downturn due to expanding margins and market share gains.

Fremont General Corp. (FMT) agreed to sell about $2.9 billion worth of its sub-prime residential real estate loans to an undisclosed buyer. The company added that it's also now in exclusive talks with the same institution under an executed letter of intent to sell most of its residential real estate business and assets. Fremont expects the sale of the sub-prime loans to result in a pre-tax loss of about $100 million.

Google (GOOG) said it's agreed to buy online advertising company DoubleClick Inc. for $3.1 billion, capping takeover talks that reportedly featured interest from other companies including Microsoft Corp. (MSFT). See full story. Google and Clear Channel (CCU) also unveiled an advertising sales agreement.

Innkeepers USA Trust (KPA) agreed to be acquired by Apollo Investment (AINV) for $1.5 billion, or $17.75 per share.

JDA Software Group Inc. (JDAS) said it expects a jump in first-quarter earnings, boosted by revenues from Manugistics, which it bought in July 2006. The Scottsdale, Ariz., maker of supply-chain management software said it expects to report first-quarter earnings of 15 cents to 17 cents a share, compared with $487,000, or 2 cents a share, a year earlier. On a non-GAAP basis, the company expects to report first-quarter earnings of 26 cents to 28 cents a share, compared with 6 cents a year earlier. JDA said it expects to report first-quarter sales of $89.7 million to $90.7 million, compared with $47.9 million a year earlier.

Magna International Inc. (MGA) was upgraded to neutral from sell at Goldman Sachs.

Mattel Inc.'s (MAT) first-quarter net income fell to 3 cents a share from 8 cents in the year-earlier period. The year-ago period includes a tax benefit for audit settlements. Net sales rose 19% to $940.3 million, partly on favorable currency exchange. The El Segundo, Calif., toymaker said worldwide gross sales rose 2% for the Barbie doll brand and 27% at Fisher-Price brands. On average, analysts surveyed by Thomson Financial expected Mattel to post a first-quarter loss of 5 cents a share on sales of $847.8 million. See full story.

MDI Inc. (MDII) shares surged after the company said it has been awarded an initial purchase order to provide security technology and systems to track cargo and transportation worker activity between selected free trade zones and a major port within the Dominican Republic.

Moody's (MCO) was upgraded to overweight from neutral at J.P. Morgan. The firm expects the company's results to significantly exceed Wall Street's consensus expectations.

North American Palladium (PAL) said palladium production jumped 68% in the first quarter to 78,805 ounces from 47,015 ounces in the same period a year earlier.

Onstream Media Corp. (ONSM) shares gained after the Pompano Beach, Fla.-based digital media company said it has been chosen by Adobe Systems Inc. as one of five members of its new Adobe Flash Media Solution Provider program. Under the program, Adobe will provide indirect and direct sales referrals to Onstream for digital media services and products. Adobe will also provide marketing, development and support that will help drive Flash streaming business, Onstream said.

Orezone Resources Inc. (OZN) said one of its units has received two uranium exploration permits from the government of Niger in West Africa.

Philips Electronics (PHG) shares rose after Europe's largest maker of consumer electronics, on Monday said first-quarter profit jumped, helped by a strong performance turned in by its personal-care and lighting units as well as by the sale of a stake in Taiwan Semiconductor Manufacturing Co. Net income for the first quarter rose to 875 million euros ($1.19 billion), or 0.79 euros a share, from 160 million euros, or 0.13 euros a share. The results were helped by a 697 million-euro non-taxable gain from the sale of a further 3.4% in Taiwan Semiconductor. See full story.

Progen Pharmaceuticals Ltd. (PGLA) shares rose after the Australia-based company announced final stage 1 results of its Phase II trial of PI-88 in patients who had previously undergone surgical removal of liver cancer. The company said the 48-week data demonstrated that 160 mg of PI-88 showed an improvement in disease-free rate, the primary endpoint, of 25% and prolonged the time to tumor recurrence to 48 weeks from 27 weeks, or by 78%.

Progressive Gaming International Corp. (PGIC) was upgraded to neutral from sell at Goldman Sachs.

Quantum Fuel Systems Technologies Worldwide (QTWW) shares surged after the company said it has signed a memorandum of understanding to establish a joint venture with a "major automaker in China" for the development of hybrid and alternative fuel vehicles, manufacture of gaseous fuel components, and integration of advanced propulsion systems. Financial terms of the deal were not disclosed.

Rural Cellular Corp. (RCCC) was upgraded to outperform from peer perform at Bear Stearns.

Sallie Mae (SLM) agreed to be acquired by an investor group for roughly $25 billion, or $60 a share. Upon closing, J.C. Flowers and private-equity firm Friedman Fleischer & Lowe will invest $4.4 billion and own about 50.2% of the company while Bank of America (BAC) and JPMorgan Chase (JPM) will each invest $2.2 billion and hold 24.9% stakes. See full story.

Streamline Health Solutions Inc. (STRM) shares surged after the Cincinnati-based provider of workflow and document management products said a new client from a hospital center in the northeastern United States will use Streamline's enterprise document workflow products. The new client is one of the largest voluntary, not-for-profit health care systems in the Northeast, Streamline Health said.

Student Loan Corp. (STU) reported first-quarter earnings of $44 million, or $2.20 per share, down from a year-ago profit of $46.2 million, or $2.31 per share. The Stamford, Conn., company said increased income from loan sales and higher servicing revenue was partially offset by lower net interest income, higher loan loss provisions and increased operating expenses in the latest quarter.

Tanger Factory Outlet Centers (SKT) was upgraded to buy from hold at Stifel Nicolaus.

USEC Inc. (USU) said the Nuclear Regulatory Commission issued a construction and operating license for the American Centrifuge Plant in Piketon, Ohio. The 30-year license includes authorization to enrich uranium to an assay level of 10% U235, the Bethesda, Md., company said. The company said it is working toward beginning commercial operations in late 2009.

VeriChip Corp. (CHIP) said it now expects revenue of $7.3 million for the first quarter, above a previous outlook for revenue of $6.9 million to $7.1 million. The Delray Beach, Fla., maker of radio frequency identification technology products cited growing demand for its infant protection and wander prevention products.

W.W. Grainger Inc. (GWW) reported first-quarter earnings of $101.8 million, or $1.17 a share, up from a year-ago profit of $86.2 million, or 93 cents a share. Sales rose 9% in the three months ended March 31 to $1.55 billion from $1.42 billion in the corresponding year-ago period. The average estimate of analysts polled by Thomson Financial was for a profit of $1.09 a share in the March period. Looking ahead, the Chicago-based provider of facilities maintenance products lifted the bottom of its 2007 earnings forecast, saying it now expects a profit ranging from $4.70 to $4.85 a share. Wall Street's current consensus estimate is for a profit of $4.74 a share for the year.

Decliners

Avant Immunotherapeutics Inc. (AVAN) launched a restructuring program that calls for a workforce reduction of about 30%. The Needham, Mass., biotechnology firm said it expects the program to lower its overall cost structure by about 18% over the next two years. It also plans to exit its research facility in St. Louis later this year and move all related activities to its headquarters in Massachusetts. The company anticipates cash restructuring costs of about $1 million, which it expects to record in the second and third quarters.

First Marblehead (FMD) shares were weak in Monday's session following Sallie Mae's agreement to be acquired by a group that includes JP Morgan Chase, the company's largest customer. Thomas Weisel said in a research note that the deal could lead to a 26% reduction in loan volume for First Marblehead as well as a 27% drop in earnings, based on the performance in 2006.

Gaming Partners International Corp. (GPIC) disclosed a delay in the filing of its Form 10-K for the fiscal year ended Dec. 31 beyond the April 17 deadline. The company said it's not yet able to determine when it will be able to file the report. Gaming Partners also said it now expects to identify certain previously disclosed accounting deficiencies as material weaknesses when it does eventually file the 10-K. The company added that it now expects to receive a delisting notice from the Nasdaq Stock Market and that a stockholder has filed an action against it.

LightPath Technologies Inc. (LPTH) expects to post fiscal third-quarter sales of $2.9 million, down 8% from $3.1 million a year earlier, on slower demand for communications products.

Parlux Fragrances Inc. (PARL) reported fiscal third-quarter earnings nearly tripled to $17.9 million, or 98 cents a share. The period ended Dec. 31 included a pretax gain of $34.2 million from the sale of the Perry Ellis fragrance brand. The loss from continuing operations was $5.46 million, compared with earnings of $1.5 million in the year-earlier period. Sales came in at $43.4 million, up 15%.

Powell Industries (POWL) said it's found accounting errors at one of its divisions, and that its financial statements, including those for each of the quarters of 2006, should no longer be relied upon pending the completion of an ongoing review. The Houston-based maker of electrical energy systems and equipment said it expects these errors to cause an increase in the cost of sales that it anticipates will lead to a reduction in net income of about $2.5 million, or 22 cents a share.

Quest Diagnostics Inc. (DGX) agreed to acquire AmeriPath Inc., a Palm Beach Gardens, Fla., diagnostic-testing services provider, for about $2 billion. The value of the deal reflects the assumption of an estimated $770 million in debt at closing. AmeriPath, which is controlled by Welsh, Carson, Anderson and Stowe IX LP, has annual revenue of more than $800 million.

Shares of Security With Advanced Technology Inc. (SWAT) dropped after PepperBall Technologies, a private San Diego-based firm, said it's filed suit against the company in federal court, charging patent infringement and breach of contract.

Semitool (SMTL) was downgraded to hold from buy at A.G. Edwards.

Supervalu Inc. (SVU) was downgraded to reduce from neutral at UBS. The firm cut its price target on the stock to $35 from $38.

Vertex Pharmaceuticals Inc. (VRTX) was downgraded to sell from hold and its price target slashed to $19 from $38 at Maxim Group on Monday on the heels of recently released clinical trial data for the company's hepatitis C drug candidate telapravir.