Nalco Soars, Ecolab Sinks on Merger Deal

by Anthony John Agnello | July 20, 2011 12:31 pm

Here’s what’s hot in the market today: Nalco Holdings shares skyrocketed after an announcement that it would merge with Ecolab, which in turn took a dip. E Trade rose ahead of its quarterly earnings report. Citi Trends and Lufkin Industries both saw high volume after reporting their second quarter earnings. Government Properties Income Trust fell slightly after pricing its latest offering.

Nalco Holding Company (NYSE: NLC[1]) jumped almost 25% to nearly $36 on more than 21 times normal trading on Wednesday morning. The energy company announced it had entered an agreement to merge with Ecolab (NYSE: ECL[2]). Plans called for Nalco shareholders to receive either close to 1 share in Ecolab or nearly $39 in cash as part of the deal. Ecolab fell close to 8% to about $51 on more than 6 times normal trading. More than 22 million shares of Nalco and more than 7 million shares of Ecolab were traded by midday.

E*Trade (NASDAQ: ETFC[3]) rose more than 15% to nearly $15 on close to 17 million shares trading, compared with the typical 4 million. The online brokerage got its boost ahead of reporting its earnings for the second quarter of 2011. A number of analysts have singled out E*Trade as an undervalued stock.

Government Properties Income Trust  (NYSE: GOV[4]) fell more than 4% to about $25.25 after pricing 6.5 million shares of common stock above $25 on Wednesday morning. Nearly 5 million shares of the real estate trust were exchanged by midday, almost 20 times the normal trading volume.

Citi Trends (NASDAQ: CTRN[5]), the clothing brand and retailer, fell 17% to about $13 after lowering expectations for its second quarter earnings. The company is expecting to report a net loss of between 60- and 70-cents per diluted share. Analysts were predicting Citi Trends to report EPS of $1.54.

Lufkin Industries (NASDAQ: LUFK[6]) fell more than 6% to about $83.15 on more than four times normal trading volume. The oil field and power equipment manufacturer reported second quarter revenue totaled $227 million, a year-on-year increase of 48%. It also revised its third and fourth quarter expectations, expecting revenues on average of around $240 million for both periods. More than 1 million shares were exchanged.

As of this writing, Anthony John Agnello did not own a position in any of the stocks named here. Follow him on Twitter at @ajohnagnello[7] and become a fan of InvestorPlace on Facebook.[8]

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  2. ECL:
  3. ETFC:
  4. GOV:
  5. CTRN:
  6. LUFK:
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