Schaeffer's S&P 500 Index Hot Stocks Features Reebok International, Aon, UnumProvident, BMC Software, and Analog Devices

Business Wire, August 3, 2005

CINCINNATI -- Among the stocks featured in the August 3 edition of Schaeffer's S&P 500 Index Hot Stocks are Reebok International (NYSE:RBK), Aon (NYSE:AOC), UnumProvident (NYSE:UNM), BMC Software (NYSE:BMC), and Analog Devices (NYSE:ADI). Schaeffer's S&P 500 Index Hot Stocks is just one of the many free market commentaries written everyday at www.SchaeffersResearch.com - the home of Bernie Schaeffer and Schaeffer's Investment Research. For additional information about this report or to have it delivered to you free via email every day click on the following link. http://www.schaeffersresearch.com/redirect.aspx?CODE=PRSHS1M&PAGE=1.

Schaeffer's S&P 500 Index Hot Stocks for Wednesday, August 3, 2005:

A daily feature available on SchaeffersResearch.com is the "SPX Hot Stocks" column. Each afternoon, we will provide a list of the day's top-20 performing stocks in the S&P 500 Index (SPX - 1,243.35) as well as the bottom-20 names. Featured along with this table will be news that is moving some of the securities.

NOTE: Stocks trading under $5 per share have been eliminated from this listing of the top-20 and bottom-20 performing stocks.

After hitting a new intraday peak earlier today, the SPX has now stepped fractionally lower, off 0.07 percent. With about 40 minutes left in the trading day, the bears are winning by a modest margin, as only about 39 percent of the index's components are trading higher.

As we have already addressed on the website today, Reebok International (NYSE:RBK) is benefiting from a buyout offer from the brand that Run D.M.C. always preferred, Adidas. Adidas-Salomon AG said early Wednesday that it will acquire the U.S.-based RBK for $3.8 billion, or a whopping 34-percent premium over the stock's Tuesday close. This move is expected to lift Adidas's U.S. market share to about 20 percent. RBK has spiked up more than 29 percent by late-day trading, cresting above its July 1997 peak to achieve a new all-time high.

Insurance brokerage Aon Corp. (NYSE:AOC) is sitting pretty in late-afternoon action, up 17 percent thanks to a positive earnings release on Tuesday evening. In its second quarter, AOC booked operating profit of $193 million, or 58 cents per share, four cents better than year-ago results. Analysts were targeting earnings of 48 cents per share. AOC officials also announced plans for a new cost-cutting procedure, for which they will swallow a third-quarter charge of $200 million to $300 million. Once implemented, however, the new plan should save the company between $100 million and $150 million each year. Elements of the restructuring plan are likely to include job cuts and reduced real-estate prices, according to a company spokesperson. This morning ahead of the opening bell, Legg Mason boosted its rating on AOC to a "hold" from a "sell."

Fellow insurer UnumProvident (NYSE:UNM) is also benefiting from a positive turn in the earnings confessional. The company said second-quarter net income rose to $171.3 million, translating to 55 cents per share, up from just two cents in the previous year (or 25 cents ahead of items). Excluding all items for the latest period, UNM would have earned 42 cents per share, or a penny better than analysts' expectations. The shares have rallied nearly 10 percent today, gapping back above their 10-day and 20-day moving averages and notching a new annual peak.

BMC Software (NYSE:BMC) also posted results that outdid analysts' forecasts. Excluding items, the company banked 20 cents per share, compared to analysts' consensus view of 13 cents. Revenue rose 6.8 percent during the period to $348.3 million. For fiscal year 2006, BMC is now targeting earnings of 90-96 cents per share, up from earlier per-share expectations of 86-92 cents. This morning, Piper Jaffray boosted its 12-month price target on the stock to $23 from $19.

On the negative side of the fence, Analog Devices (NYSE:ADI) is bringing up the rear with a loss of nearly five percent. Last Tuesday, the company said its third-quarter earnings would be below previous estimates, thanks to reduced chip sales in the wireless handset market. ADI is targeting revenue of between $580 million and $585 million, a three-to-four percent drop from the previous quarter, and below the originally projected 0.3-percent rise in the figure. Additionally, this number is well below analysts' revenue estimate of $617.2 million. Earnings per share are now targeted at 31 cents, two pennies lower than Wall Street's consensus estimate.

National Semiconductor (NSM) has lost nearly three percent today after Morgan Stanley lowered its rating on the stock to an "equal weight" from an "overweight," citing valuation concerns. The brokerage said that while it has faith in the firm's fundamentals, it is wary because the stock has already notched the $25 price target. Although NSM reached a new annual high yesterday, today's downgrade has brought the shares into contact with potential support from their 10-day moving average.

Click the following link to see a Chart of the SPX 500 Index's Top-20 Percentage Gainers: http://www.schaeffersresearch.com/wire?ID=13788 .