From Briefing.com: 4:36 pm Xilinx beats by $0.07, reports revs in-line; guides Q3 revs flat sequnetially (XLNX) : Reports Q2 (Sep) earnings of $0.61 per share, excluding non-recurring items, $0.07 better than the Capital IQ Consensus of $0.54; revenues rose 9.7% year/year to $579 mln vs the $574.95 mln Capital IQ Consensus.
Co issues guidance for Q3, sees Q3 revs flat sequentially (~$579 mln) vs. $584.95 mln Capital IQ Consensus Estimate.
Gross margin is expected to be approximately 69%.
Operating expenses are expected to be approximately $245 million including $1 million of amortization of acquisition-related intangibles.
4:13 pm Lam Research beats by $0.03, reports revs in-line; guides Q2 above consensus (LRCX) :
Reports Q1 (Sep) earnings of $1.81 per share, excluding non-recurring items, $0.03 better than the Capital IQ Consensus of $1.78; revenues rose 2.0% year/year to $1.63 bln vs the $1.63 bln Capital IQ Consensus.
Non-GAAP gross margin of 45.2%, non-GAAP operating margin of 22.4%, and non-GAAP diluted EPS of $1.81.
Deferred revenue at the end of the September 2016 quarter increased to $704 million as compared to $566 million at the end of the June 2016 quarter. Deferred profit at the end of the September 2016 quarter increased to $418 million as compared to $349 million at the end of the June 2016 quarter.
Co issues guidance for Q2, sees EPS of $2.08-2.28, may not be comparable to $1.80 Capital IQ
Consensus Estimate; sees Q2 revs of $1.765-1.915 bln vs. $1.65 bln Capital IQ Consensus Estimate; sees shipments of $1.85 bln +/- $75 mln
4:11 pm Lam Research reschedules investor meeting to Friday, November 18 from November 16 (meeting will serve as a general update for investors and analysts on Lam's strategy and operations) (LRCX) :
4:15 pm : The stock market ended the midweek affair on a flat note as investors responded to a fresh batch of quarterly earnings reports and a rally in crude oil futures. The Dow Jones Industrial Average (+0.2%) settled in-line with the S&P 500 (+0.2%) and slightly ahead of the Nasdaq Composite (+0.1%).
The broader market inched higher at the start of the session as better-than-expected quarterly results from members of the energy (+1.4%) and financial (+0.8%) sectors helped boost risk appetite in the broader market.
Commercial banking name U.S. Bancorp (USB 43.58, +0.57) helped rally the industry group after reporting a bottom-line beat and estimating that net interest income will increase next quarter. Morgan Stanley (MS 32.93, +0.61) finished higher by 1.9% after beating top- and bottom-line estimates for the quarter. Meanwhile, oilfield service name Halliburton (HAL 49.07, +2.00) rallied 4.3% after topping earnings estimates and noting that rig count activity has been picking up.
Equity indices extended their gains after the opening hour as investors assessed the latest inventory data from the Department of Energy. The EIA reported that crude oil stockpiles declined by 5.24 million barrels (consensus: +2.70 million) while gasoline stockpiles rose by 2.46 million barrels (consensus: -1.31 million). The energy component jumped on the news, settling higher by 2.6% ($51.59/bbl; +$1.30).
The benchmark index gained lockstep with crude oil, briefly clearing technical resistance near the 2144 price level. However, the S&P 500 moved lower in the final hour as participants eyed potentially market-moving events out of the US and Europe. On that note, the European Central Bank will hold its October policy meeting tomorrow morning.
Eight sectors ended in positive territory with energy (+1.4%), financials (+0.8%), materials (+0.7%), and consumer discretionary (+0.5%) leading the pack.
The economically-sensitive financial sector (+0.8%) outperformed as participants eyed above-consensus quarterly results and largely positive economic data. Dow component American Express (AXP 61.25, +1.17) finished at the top of the price-weighted average ahead of this evening's quarterly report. The broader financial sector extended its October gain to 1.7%, leading the remaining sectors over that period.
In the consumer discretionary sector (+0.5%), Netflix (NFLX 121.87, +3.08) extended its post-earnings winning streak, spiking 22.1% since reporting upbeat quarterly results on Monday evening. Tesla Motors (TSLA 203.56, +4.46) was also making waves after CEO Elon Musk confirmed that a product announcement will take place at 20:00 ET.
Chipmakers finished behind the broader technology sector (UNCH) as the PHLX Semiconductor Index slipped 0.5%. Intel (INTC 35.51, -2.24) weighed on the group after issuing disappointing fourth-quarter revenue and gross margin guidance. However, the company did beat top- and bottom-line estimates for the quarter. Shares of Intel finished lower by 5.9%.
Health care equipment names lagged in the health care space (-0.3%) with Intuitive Surgical (ISRG 681.58, -40.15) declining 5.6%. The downturn came despite the company reporting better-than-expected quarterly results. Separately, Abbott Labs (ABT 40.01, -1.16) declined 2.8% as some weakness in its nutrition sales masked largely in-line quarterly results.
Treasuries finished on a flat note as yields finished little changed across the curve. The yield on the 2-yr note settled at 0.80% while the yield on the benchmark 10-yr note finished at 1.74%.
Today's trading volume fell below the average of 853 million as 798 million shares changed hands at the NYSE floor.
Today's economic data included the weekly MBA Mortgage Index and Housing Starts/Building Permits for September:
The MBA Mortgage Index indicated that mortgage applications rose 0.6% in the week ending October 15. This followed a 6.0% decrease in the prior week.
Housing starts declined 9.0% in September to a seasonally adjusted annual rate of 1.047 million units (Briefing.com consensus 1.168 million) while permits -- a leading indicator -- increased 6.3% to a seasonally adjusted annual rate of 1.225 million (Briefing.com consensus 1.164 million).
For more on these economic releases, be sure to visit Briefing.com's Economic Calendar page.
Thursday's economic data will include the 8:30 ET release of weekly initial claims (Briefing.com consensus 249k) and the Philadelphia Fed Survey for October (Briefing.com consensus 5.5). Separately, the September Existing Home Sales Report (Briefing.com consensus 5.30 million) and September Leading Indicators (Briefing.com consensus 0.2%) will be released at 10:00 ET.
Russell 2000: +7.7% YTD
S&P 500: +4.9% YTD
Nasdaq Composite: +4.8% YTD
Dow Jones: +4.5% YTD
DJ30 +40.68 NASDAQ +2.58 SP500 +4.69 NASDAQ Adv/Vol/Dec 1667/1.411 bln/1095 NYSE Adv/Vol/Dec 2092/778.2 mln/867
3:30 pm :
Commodities, as measured by the Bloomberg Commodity Index, were +0.4% around the 86.89
Crude oil broke out to fresh 52-week highs after EIA data showed an unexpected draw compared to Consensus
November crude oil futures rose $1.30 (+2.6%) to $51.59/barrel
EIA highlights:
Crude oil inventories had a draw of -5.247 mln (consensus called for a build of about +2.71 mln barrels)
Gasoline inventories had a build of +2.469 mln (consensus called for a draw of about -1.32 mln barrels)
Distillate inventories had a draw of -1.240 mln
Natural gas erased all of yesterday's gains ahead of tomorrow's inventory data
November natural gas closed $0.09 lower (-2.8%) at $3.17/MMBtu
Weekly EIA natural gas inventory data will be released at 10:30 am ET.
In precious metals, gold extended yesterday's gains, silver ended nearly flat as the dollar index remained directionless
December gold ended today's session up $7.10 (+0.6%) to $1270.10/oz
December silver closed today's session $0.02 higher (+0.1%) at $17.66/oz
Base metal copper inched lower after 2 consecutive days of closing flat
December copper closed $0.01 lower (-0.5%) at $2.10/lb
The broader market added modest gains on Wednesday, with the best index, the Dow Jones Industrial Average adding 40.68 points (+0.22%) to 18202.62. The S&P 500 was up 4.69 points (+0.22%) to 2144.29, and the Nasdaq Composite gained 2.58 points (+0.05%) to 5246.41.
Commercial banking name U.S. Bancorp (USB 43.58, +0.57 +1.33%) helped rally the industry group after reporting a bottom-line beat and estimating that net interest income will increase next quarter. Morgan Stanley (MS 32.93, +0.61) finished higher by 1.9% after beating top- and bottom-line estimates for the quarter. Meanwhile, oilfield service name Halliburton (HAL 49.07, +2.00) rallied 4.3% after topping earnings estimates and noting that rig count activity has been picking up.
Equity indices extended their gains after the opening hour as investors assessed the latest inventory data from the Department of Energy. The EIA reported that crude oil stockpiles declined by 5.24 million barrels while gasoline stockpiles rose by 2.46 million barrels. The energy component jumped on the news, settling higher by 2.6% ($51.59/bbl; +$1.30).
Today's market data included the MBA Mortgage Index reading which indicated that mortgage applications rose 0.6% in the week ending October 15. This followed a 6.0% decrease in the prior week. Also, housing starts were down 9.0% in September to a seasonally adjusted annual rate of 1.047 million units while permits -- a leading indicator -- increased 6.3% to a seasonally adjusted annual rate of 1.225 million. Additionally, the Fed's Beige Book was released at 2:00 p.m. ET and noted most districts saw modest to moderate growth with expectations for the pace of growth to continue at slight to moderate pace.
The Technology (XLK 47.62, +0.09 +0.19%) was up only modestly today but finished near highs of the session. Component Intel (INTC 35.51, -2.24 -5.93%) was the worst performer in the sector today following results which topped Q3 expectations but fell short of investors' hopes for Q4 guidance. Other sectors as measured by the S&P closed Wednesday XLE +1.38%, XLF +0.87%, XLFS +0.81%, XLB +0.73%, IYZ +0.54%, XLY +0.44%, XLRE +0.38%, XLI +0.31%, XLU -0.23% XLV -0.37% XLP -0.57% with Energy and Financials leading the positive bias.
In the S&P 500 Information Technology (799.21, +0.13 +0.02%) sector, trading ended barely above flat lines as sellers attempted to drive the space back into the red. Component Seagate Tech (STX 34.32, -1.02 -2.89%) was weak today despite reporting results which beat market expectations. Other names in the space which could not manage to climb out of negative territory included STX -2.89%, EA -1.49%, MU -1.12%, XLNX -1.04%, ATVI -0.88%, WDC -0.72%, HPQ -0.63%, QCOM -0.47%.
Other notable news items among sector components:
Hewlett Packard Enterprise (HPE 21.73, +0.26 +1.21%) reaffirmed its FY16 guidance and issued three views of FY17 financial outlook. HPE reaffirmed guidance for FY16 (Oct) EPS of $1.90-1.95 on revenue growth of +1-2% y/y when adjusted for recent divestitures and currency. As communicated on HPE's Q3 call, HPE expects to deliver free cash flow of $1.7 -1.9 billion in FY16, and to return over $3 billion of cash to shareholders this year, in the form of share repurchases and dividends. Also, given two pending transactions -- the spin-merge of Enterprise Services with CSC in early April and the spin-merge of Software with Micro Focus in 2H FY17 - HPE provided three different views of its FY17 financial outlook. As a combined company, HPE expects revenue to be flat to down 1% when adjusted for divestitures and currency. HPE expects non-GAAP EPS to be $2.00 to $2.10. As reported, HPE sees non-GAAP EPS to be ~$1.45 to $1.55. The future HPE expects to see modest revenue growth in FY17 with non-GAAP EPS of ~$1.25 -1.35 in FY17.
According to reports, Alphabet (GOOG 801.56, +6.30 +0.79%) is in talks with Disney (DIS 91.93, +0.76 +0.83%) and Fox (FOXA 25.12, +0.16 +0.64%) regarding a potential internet TV service. Reportedly has reached a similar agreement with CBS (CBS 55.53, +0.43 +0.78%).
Red Hat (RHT 78.27, +0.77 +0.99%) and Ericsson (ERIC 5.40, -0.07 -1.28%) announced a broad alliance to deliver fully open source and production-ready cloud infrastructure, spanning OpenStack, software-defined networking (SDN) and software-defined infrastructure (SDI).
Linear Tech (LLTC 59.31, +0.37 +0.63%) announced that, based on a preliminary vote tally from LLTC's Annual Meeting of Stockholders, stockholders approved the merger agreement under which Analog Devices (ADI 61.91, -0.23 -0.37%) will acquire LLTC.
Juniper Networks (JNPR 22.95, +0.10 +0.44%) announced that the United Arab Emirates' (U.A.E.) Advanced Military Maintenance, Repair and Overhaul Center (AMMROC) has built a mission-critical network infrastructure based on JNPR's switching, security and network management technology.
DarkMatter, an international cyber security firm headquartered in the UAE, and NetApp (NTAP 33.68, +0.03 +0.09%) announced a partnership to jointly develop and deliver secure data storage and big data analytics solutions.
NTAP also announced the appointment of Bill Miller as chief information officer (CIO).
Visa (V 82.81, +1.23 +1.51%) increased its quarterly dividend to $0.165 per share from $0.14 per share.
Elsewhere in the tech space:
Synopsys (SNPS 59.76, +0.14 +0.23%) confirmed a federal appellate court has ruled in favor of Mentor Graphics (MENT 28.69, -0.12 -0.42%). SNPS said the ruling will have no impact on ZeBu sales or support.
Vectrus (VEC 16.52, +0.38 +2.35%) to eliminate an additional 64 positions at its Colorado Springs headquarters; will result in an about $2 million severance expense in the fourth quarter of 2016.
Science Applications (SAIC 67.48, -0.12 -0.18%) received SSC pacific contract to support cyberspace operations systems; potential value of more than $142 million.
In reaction to quarterly results:
Intel (INTC) reported Q3 results which beat raised guidance. Q3 EPS was $0.80 on revenues which rose 9.1% compared to last year to $15.78 billion. Guided Q4 revenues in the range of $15.2-16.2 billion on gross margins of 63%, plus or minus a couple percent.
Yahoo! (YHOO 42.73, +1.05 +2.52%) reported better than expected Q3 EPS of $0.20 on revenues which fell 14.6% compared to a year ago to $857 million. YHOO also issued downside guidance for Q4 revenues of $880-920 million. YHOO also updated their FY16 revenue guidance to $3.440-3.480 billion, ex tac, from $3.4-3.6 billion.
Seagate Tech (STX) reported better than expected Q1 EPS of $0.99 on revenues which fell 4.4% versus last year to $2.80 billion.
Cree (CREE 22.41, -2.79 -11.07%) reported worse than expected Q1 EPS of $0.09 on revenues which fell 15.8% compared to last year to $321.3 million. The company also issued downside guidance for Q2 EPS in the range of $0.04-0.10 on revenues of $310-330 million.
Linear Tech (LLTC) reported worse than expected Q1 EPS of $0.53 on revenues which rose 9.4% compared to a year ago to $373.9 million.
Amphenol (APH 64.71, +1.50 +2.37%) reported better than expected Q3 EPS and revenues of $0.73 and $1.64 billion, respectively. For Q4, APH sees in-line EPS and revenues of $0.71-0.73 and $1.59-1.63 billion, respectively.
ASML (ASML 104.07, +1.74 +1.70%) reported worse than expected EPS of EUR0.03 on better than expected revenues of EUR1.82 billion. For Q4, ASML sees revenues of EUR1.7-1.8 billion.
Companies scheduled to report tonight/tomorrow morning: CTXS, EBAY, LRCX, XLNX/CTXS, EBAY, LRCX
Analyst actions:
TWTR was upgraded to Hold from Sell at Loop Capital,
INTC was upgraded to Buy from Mkt Perform at Charter Equity,
DSGX was upgraded to Sector Outperform from Sector Perform at CIBC,
MOMO was upgraded to Overweight from Equal Weight at Morgan Stanley;
VDSI was downgraded to Neutral from Buy at Dougherty,
CREE was downgraded to Equal Weight from Overweight at Stephens;
SQ and CDNS were initiated with Neutral ratings at Credit Suisse,
MENT and SNPS were initiated with Outperform ratings at Credit Suisse,
WEB and EIGI were initiated with Hold ratings at Cantor Fitzgerald,
GDDY and WIX were initiated with Buy ratings at Cantor Fitzgerald,
IPAS was initiated with a Buy at Maxim Group,
SHOP was initiated with a Buy at Rosenblatt,
RP was initiated with an Overweight at Stephens
