Diamonds and Dogs

4/29/13

Choice Hotels International Inc. (CHH)

Choice Hotels International is trading in the red today, down 10.55% at $40.52. The hotel franchisor saw its shares fall out of bed after releasing earnings. For the quarter, Choice Hotels announced earnings of $0.26 per share which missed analyst estimates of $0.27 per share. The small miss seemed to show the beginning of a decline, as management decreased their outlook. Next quarter the company stated it expected an EPS of $0.45, which is well below analysts' forecast of $0.52. Furthermore, Choice Hotels management lowered their full year EPS forecast to $1.87-1.91 from $1.96-1.98. Shares lost over $4.50 today, but are still well above their 52-week low of $30.40.

Moody's Corp. (MCO)

Moody's is putting its investors in a good mood today, up 8.29% at $59.69. The credit rating company saw its shares bounce after fraud lawsuit was settled. Moody's (and Standard and Poor's) settled its lawsuit with Morgan Stanley. The lawsuit was related to two failed investment vehicles; more specifically relating to Moody's (and Standard and Poor's) ratings during the financial collapse. The settlement is significant because expunges the lengthy litigation and allows for only civil fraud claims. Furthermore, the settlement is a weight off of the companies back and allows investors to feel better about investing in Moody's. Shares traded to a new 52-week high of $61.26 intraday.

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