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Thursday, April 21, 2016 5:42:52 PM
From Briefing.com: 4:17 pm Advanced Micro beats by $0.01, beats on revs; guides Q2 rev above estimates (AMD) : Reports Q1 (Mar) loss of $0.12 per share, excluding non-recurring items, $0.01 better than the Capital IQ Consensus of ($0.13); revenues fell 19.2% year/year to $832 mln vs the $818.41 mln Capital IQ Consensus.Gross margin of 32 percent, up 2 percentage points sequentially, due primarily to a richer product mix and the mix of revenue between business segments. Co sees Q2 rev +12-18% QoQ to ~$932-982 mln vs $889.66 mln Capital IQ Consensus Estimate
4:15 pm Microsoft misses by $0.02, reports revs in-line; guides Q3 on call (MSFT) :
Reports Q3 (Mar) earnings of $0.62 per share, excluding non-recurring items, $0.02 worse than the Capital IQ Consensus of $0.64; revenues rose 1.6% year/year to $22.08 bln vs the $22.11 bln Capital IQ Consensus.
Productivity and Business Processes rev +1% to $6.5 bln vs. $6.4-6.6 bln guidance.
Office commercial products and cloud services revenue grew 7% in constant currency driven by Office 365 revenue growth of 63% in constant currency
Office consumer products and cloud services revenue grew 6% in constant currency with Office 365 consumer subscribers increasing to 22.2 million
Dynamics products and cloud services revenue grew 9% in constant currency with Dynamics CRM Online seat adds more than doubling year-over-year.
Intelligent Cloud rev +3% to $6.1 bln vs. $6.1-6.3 bln guidance
Server products and cloud services revenue increased 5% in constant currency driven by double-digit annuity revenue growth
Azure revenue grew 120% in constant currency with usage of Azure compute and Azure SQL database more than doubling year-over-year
Enterprise Mobility customers more than doubled year-over-year to over 27,000, and the installed base grew nearly 4x year-over-year.
Personal Computing revs +1% to $9.5 bln vs. $9.1-9.4 bln guidance.
Windows OEM revenue declined 2% in constant currency, outperforming the PC market, driven by higher consumer premium device mix
Surface revenue increased 61% in constant currency driven by Surface Pro 4 and Surface Book
Phone revenue declined 46% in constant currency
Xbox Live monthly active users grew 26% year-over-year to 46 million.
4:11 pm Ultra Clean Holdings misses by $0.02, beats on revs; guides Q2 EPS in-line, revs above consensus (UCTT) :
Reports Q1 (Mar) net of breakeven, excluding non-recurring items, $0.02 worse than the Capital IQ Consensus of $0.02; revenues fell 10.5% year/year to $112.2 mln vs the $109.86 mln Capital IQ Consensus. Co issues guidance for Q2, sees EPS of $0.05-0.08 vs. $0.06 Capital IQ Consensus Estimate; sees Q2 revs of $123-128 mln vs. $114.58 mln Capital IQ Consensus Estimate.
4:10 pm E*TRADE beats by $0.10, reports revs in-line (ETFC) :
Reports Q1 (Mar) earnings of $0.43 per share, $0.10 better than the Capital IQ Consensus of $0.33; revenues rose 7.0% year/year to $472 mln vs the $475.14 mln Capital IQ Consensus.
Reports Daily Average Revenue Trades (DARTs) of 165,000.Net new brokerage accounts of 45,000 and an annualized attrition rate of 7.3%, excluding the impact of shutting down the Company's Hong Kong and Singapore operations.Reports allowance for loan losses of $322 mln resulting in a benefit to provision for loan losses of $34 mln.Co utilized $301 mln to repurchase 13.1 mln shares at an average price of $23.01, bringing the total utilization under the company's program to $351 mln.
4:03 pm Maxim Integrated misses by $0.01, reports revs in-line; guides Q4 EPS in-line, revs in-line (MXIM) :
Reports Q3 (Mar) earnings of $0.41 per share, $0.01 worse than the Capital IQ Consensus of $0.42; revenues fell 3.8% year/year to $555 mln vs the $555.35 mln Capital IQ Consensus. Co issues in-line guidance for Q4, sees EPS of $0.45-0.51 vs. $0.47 Capital IQ Consensus Estimate; sees Q4 revs of $555-595 mln vs. $568.85 mln Capital IQ Consensus Estimate. The Company's 90-day backlog at the beginning of the June quarter of 2016 was $370 million.
4:15 pm : The stock market ended the Thursday affair on a lower note as the major averages pulled back after a recent run higher. Today's downturn can be attributed to retreating oil prices, mixed earnings results, and the underperformance of the heavily-weighed financial sector (-1.0%). The Dow Jones Industrial Average (-0.6%) finished its day behind both the S&P 500 (-0.5%) and the Nasdaq Composite (-0.1%).
Equity indices began the day under pressure as an overnight retreat in oil weighed. The dip in crude preceded the latest policy statement from the European Central Bank, which left the central bank's interest rate corridor unchanged. Additionally, ECB President Draghi struck a dovish tone in his remarks as he reiterated that rates will remain at their present levels or lower for an extended period of time. Furthermore, Mr. Draghi said financing conditions in the eurozone improved in March, but the central bank head believes that inflation could turn negative in the coming months.
On the home front, investors turned their attention towards the slew of mixed quarterly earnings reports released since yesterday's close. However, despite some better-than-expected readings the major averages were unable to maintain their recent momentum. The benchmark index was unable to reach yesterday's high (2111.05) or maintain its position near yesterday's low (2096.32).
By the end of the session, nine sectors traded in negative territory with countercyclical telecom services (-2.7%), utilities (-2.2%), and consumer staples (-1.7%) outpacing the losses in the broader market. Meanwhile, financials (-1.0%), and energy (-0.5%) registered slimmer losses. On the flip side, the heavyweight health care space (+0.6%) ended its day as the lone advancer.
In the lightly-weighted telecom services sector (-2.7%), large cap component Verizon (VZ 50.03, -1.72) weighed after hinting that its second quarter earnings may be pressured due to timing of certain cost reductions in relation to the CWA and IBEW strike.
Insurance names underperformed in the financial sector (-1.0%) as the sub-group moved lower in sympathy with Travelers (TRV 108.79, -7.01). The stock fell 6.1% after missing bottom-line estimates for the first quarter. The broader sector trimmed its April advance to 3.5%. On the flipside, Bank of New York Mellon (BK 40.70, +0.98) gained 2.5% after reporting bottom-line results above analysts' estimates.
In the industrial space (-0.3%), relative weakness from airlines outweighed an uptick in rail names. The airline sub-group traded lower in sympathy with United Continental (UAL 52.76, -5.84), which tumbled 10.0% after lowering passenger revenue guidance for the second quarter. Separately, Union Pacific (UNP 87.32, +3.47) rallied 4.1% on mixed earnings, with investors focusing on a bottom-line beat. The Dow Jones Transportation Average (-1.2%) trimmed its weekly gain to 0.4%.
The biotechnology sub-group outperformed in the health care space (+0.6%), thanks to Biogen (BIIB 279.60, +13.71). The company reported a bottom-line beat on in-line revenue ahead of today's opening bell. Biogen also reported that revenue grew 6.7% year-over-year thanks in part to a 15.0% increase in revenue from Tecfidera.
The influential technology sector (-0.1%) ended near its flat line as Apple (AAPL 105.97, -1.16) underperformed following Qualcomm's (QCOM 51.67, -0.42) mixed guidance for the June quarter. The below-consensus estimate is believed to be linked to weakness in smartphone components. Meanwhile, Microsoft (MSFT 55.78, +0.19) and Alphabet (GOOG 759.14, +6.47) outperformed ahead of this evening's quarterly earnings reports.
The U.S. Dollar Index (94.64, +0.15) ended its day above its flat line as the greenback recovered from sharp losses against the euro. The euro/dollar pair jumped to 1.1381 immediately following remarks from ECB President Mario Draghi. However, this move would prove to be short-lived as the currency pair retraced its way down to negative territory at 1.1288 (-0.1%). Separately, the dollar lost 0.4% against the yen (109.45).
Despite the larger move in the equities market, Treasuries managed to remain in a narrow range with the yield on the 10-yr note fluctuating between 1.86% and 1.88%. The yield on the benchmark note settled at 1.86% (+2 bps).
Today's participation was above the recent average with more than 987 million shares changing hands at the NYSE floor.
Today's economic data included weekly initial claims, the Philadelphia Fed Survey for April, FHFA Housing Price Index for February, and March Leading Indicators:
Initial claims were 247,000 for the week ending April 16 (Briefing.com consensus 263,000), a decrease of 6,000 from the prior week's unrevised level.
The latest initial claims reading, which was not influenced by special factors, is the lowest level of initial claims since November 24, 1973 and marked the 59th straight week claims have been below 300,000, which is the longest streak since 1973!
The claims data is a clear reflection of a strong labor market -- or so it would seem. The other important piece to corroborate that statement -- average hourly earnings growth -- has yet to follow convincing suit.
With the latest reading, the four-week moving average for initial claims fell to 260,500 from 265,000.
Continuing claims for the week ending April 9 dropped by 39,000 to 2.137 million, which is the lowest level since November 4, 2000.
That lowered the four-week moving average to 2.169 million, which is the lowest level since November 11, 2000
The Philadelphia Fed Index was a big disappointment. After turning positive in March (+12.4) following six straight negative readings, it dropped back into negative territory in April (-1.6; Briefing.com consensus +9.9).
There were several key elements making this a particularly disappointing report: (1) the new orders index decreased from 15.7 to zero (2) the shipments index fell from 22.1 to -10.8 (3) the employment index decreased 17 points and registered its fourth straight negative reading (-18.5) and (4) this is a second quarter report showing a relapse in growth of the region's manufacturing sector.
The latter point notwithstanding, the diffusion index for future general activity increased from 28.8 to 42.2.
The FHFA Housing Price Index for February rose 0.4% month-over-month after increasing a revised 0.4% (from 0.5%) in January.
The Leading Economic Index increased 0.2% in March (Briefing.com consensus+ 0.4%). The added disappointment in the report is that February was revised lower to show a 0.1% decline after an originally reported 0.1% increase.
The biggest contributors to the March increase were stock prices (0.24 percentage points) and the interest rate spread (0.17 percentage points).
They were offset to a certain degree by building permits, which subtracted 0.25 percentage points.
The building permits impact effectively accounted for much of the difference between the consensus estimate and the actual number. The building permits data for March was released earlier in the week.
The other two components estimated by the Conference Board were manufacturers' new orders and nondefense capital goods orders excluding aircraft.
Neither was accorded much strength as the estimated contributions were 0.01 and 0.03 percentage points, respectively.
In the six-month period ending March 2016, the leading economic index increased 0.7% versus 1.5% in the previous six months.
Separately, the Coincident Economic Index remained unchanged in March while the Lagging Economic Index increased 0.4%.
There is no economic data of note scheduled for release tomorrow.
Dow Jones +3.2% YTD
S&P 500 +2.3% YTD
Russell 2000 +0.0% YTD
Nasdaq Composite -1.2% YTD
DJ30 -113.75 NASDAQ -2.24 SP500 -10.92 NASDAQ Adv/Vol/Dec 1323/1.575 bln/1498 NYSE Adv/Vol/Dec 1089/987.0 mln/1905
3:30 pm :
The dollar index stages a brief afternoon rally before drifting slightly off its high of the day, currently up +0.1% at 94.61 & weighing on commodities
Commodities, as measured by the Bloomberg Commodity Index, are down -0.7% at 83.59
Crude oil sees a notable downtrend, consolidating near its low of the day and closing slightly above this level
June Crude Oil futures fell $0.97 (-2.2%) to $43.18/barrel
Natural gas exhibited notable volatility, initially selling off after the release of EIA storage data before rebounding and then drifting lower, closing unchanged on the day
May Natural Gas closed flat at $2.07/MMBtu
Natural gas inventory showed a build of +7 bcf vs expectations for inventory to be a build of ~0-6 bcf
Working gas in storage was 2,484 Bcf as of Friday, April 15, 2016, according to EIA estimates. This represents a net increase of +7 Bcf from the previous week. Stocks were 881 Bcf higher than last year at this time and 811 Bcf above the five-year average of 1,673 Bcf. At 2,484 Bcf, total working gas is within the five-year historical range
In precious metals, gold initially plummets at the open of pit trading and drifts lower all day, consolidating near the lows for the day
June gold ended today's session down $4.20 (-0.3%) to $1250.20/oz
Silver trends and closes lower on the day
May silver closed today's session $0.06 lower (-0.4%) at $17.09/oz
Base metal copper trades sideways, managing to carve out a modest gain near the close of pit trading
May copper closed $0.01 higher (+0.5%) at $2.25/lb
When the final bell rang, the markets were modestly lower. Trading ended with the Dow Jones Industrial Average as the worst performer (helped lower by the -2.2% loss in June Crude Oil Futures), shedding 113.75 points (-0.63%) to close 17982.52. The S&P 500 was down 10.92 points (-0.52%) to 2091.48. To round out the trio, the Nasdaq Composite was lower by 2.24 points (-0.05%) to 4945.89. Today's session began on a modestly lower note as participants digested remarks from ECB President Draghi. Mr. Draghi's remarks generally fell in-line with market expectations, as he stated that interest rates will likely remain lower for longer. President Draghi also stated that financing conditions generally improved in the eurozone in March, but that inflation could turn negative in the coming months.
Market data today came in the form of the initial claims reading for the week ending April 16 which showed a decline of 6,000 to 247,000. Continuing claims for the week ending April 9 were down by 39,000 to 2.137 million -- the lowest level since November 4, 2000. The Philadelphia Fed Index was a disappointment, as after turning positive in March (+12.4), it dropped back into negative territory in April (-1.6). The FHFA Housing Price Index for February rose 0.4% month-over-month after increasing a revised 0.4% (from 0.5%) In January. Finally, the Leading Economic Index increased 0.2% in March, and adding to the disappointment in the report was that February was revised lower to show a 0.1% decline after an originally reported 0.1% increase.
Trading in the Technology (XLK 44.21, -0.16 -0.36%) sector was in the red for pretty much the entirety of the day, save for a few brief moments in the first two hours of action. Component F5 Networks (FFIV 102.54, +5.38 +5.54%) was the best performer in the sector as the company reported better than expected Q2 EPS and issued mixed Q3 guidance; additionally, FFIV's BoDs authorized an additional $1 billion to the common stock repurchase program. Other sectors as measured by the S&P closed XLV +0.59%, XLI -0.25%, XLY -0.35%, XLB -0.45%, XLE -0.59%, XLF -0.89%, IYZ -1.61%, XLP -1.64%, XLU -2.09% with Healthcare the only sector managing gains and Utilities and Consumer Staples lagging.
In the S&P 500 Information Technology (736.71, -0.87 -0.12%) sector, action was modestly to the downside as the sector hovered near flat lines for the majority of the session. Component Alliance Data (ADS 202.60, -15.32 -7.03%) was the worst performer in the sector as the company reported mixed Q1 results and issued weak guidance for the Q2 period. Other names in the space which underperformed included LRCX -2.24%, PAYX -2.06%, FIS -1.82%, APH -1.71%, HPQ -1.64%, SWKS -1.58%, INTU -1.39%, KLAC -1.34%, QRVO -1.28%, TSS -1.27%, AVGO -1.23%, FISV -1.16%, AAPL -1.08%.
Other notable news items among sector components:
In addition to reporting quarterly results, F5 Networks' (FFIV) Board of Directors announced the authorization of an additional $1 billion for FFIV's common stock share repurchase program.
Qualcomm (QCOM 51.67, -0.42 -0.81%) signed a 3G/4G Chinese patent license agreement with Hisense, resolving arbitration dispute over licensing terms.
Onvia (ONVI 3.47, -0.01 -0.29%) announced integration capabilities with Salesforce (CRM 77.15, +1.01 +1.33%). Clients can now easily export Onvia leads to Salesforce, enabling their teams to respond more quickly and efficiently.
Box (BOX 13.00, +0.21 +1.64%) and Cognizant (CTSH 60.05, -0.04 -0.07%) announced a collaboration that will help enterprises transform the way they work with Box Platform.
Acorns raised $30 million in financing, including strategic investments from PayPal (PYPL 40.10, +0.02 +0.05%) and Rakuten Fintech Fund.
MasterCard (MA 97.54, -0.36 -0.37%) and the MLB announced an extension of their longstanding partnership agreement. The expanded partnership agreement provides MasterCard the presenting sponsorship role beginning with the 2016 All-Star Game, as well as increased opportunity to deliver advanced payment technologies to baseball fans.
Elsewhere in the tech space:
SunEdison (SUNE 0.33, -0.00 -0.33%) confirmed it has filed Chapter 11 bankruptcy. The company noted yieldcos TerraForm Power (TERP 10.46, +0.60 +6.09%) and TerraForm Global (GLBL 2.99, +0.39 +15.00%) are not part of the filing.Later, both TERP and GLBL announced they had 'no plans to file for bankruptcy themselves.' Both stated they still have sufficient liquidity to operate their respective businesses. In addition to reporting quarterly results, Ericsson (ERIC 8.27, -1.48 -15.18%) announced certain structural changes. Among these - a new organizational structure will be implemented July 1, 2016 whereby the company will have five businesses and one dedicated customer group. Additionally, ERIC announced certain appointments to the ERIC Executive Leadership Team and regional heads.
Vectrus (VEC 173.52, +0.72 +0.42%) received a $12 million telecom contract for the USAF in Europe.
Plexus' (PLXS 41.82, +3.24 +8.40%) CEO Dean Foate to retire at end of FY16. COO Todd Kelsey will become CEO on October 2.
Smiths Group (SMGZY 16.79, +0.56 +3.45%) acquired Morpho Detection from Safran S.A. (SAFRY 17.02, -0.42 -2.41%) for $710 million.
PTC (PTC 37.55, +3.34 +9.76%) disclosed recent shareholder lawsuit as well as investigation by the China Administration for Industry and Commerce.
In reaction to quarterly results:
Verizon (VZ 50.03, -1.72 -3.32%) reported in-line Q1 EPS of $1.06 on in-line revenues which rose 0.6% versus last year to $32.17 billion. Additionally, VZ reported 640,000 postpaid net additions in the quarter. Looking ahead, VZ reaffirmed FY16 EPS guidance of comparable to $3.99 in 2015.
Qualcomm (QCOM) reported better than expected Q2 EPS and revenues of $1.04 and $5.55 billion, respectively. Additionally, QCOM issued in-line guidance for Q3 EPS and revenues in the range of $0.90-1.00 and $5.2-6.0 billion, respectively.
Ericsson (ERIC) reported worse than expected Q1 EPS and revenues of $0.87 and $52.2 billion, respectively.
Citrix Systems (CTXS 84.03, +3.51 +4.36%) reported better than expected Q1 EPS and revenues of $1.18 and $826 million, respectively. CTXS also guided Q1 EPS better than expected at $1.12-1.15 with revenue expectations in-line with anticipations at $810-820 million. Looking ahead, CTXS sees FY16 EPS and revenues better than expected at $4.90-5.00 and $3.34-3.36 billion, respectively.
Alliance Data (ADS) reported better than expected Q1 EPS and in-line revenues of $3.84 anf $1.68 billion, respectively. Additionally, the company issued tepid guidance for the Q2 period's EPS and revenue numbers -- $3.58 and $1.62 billion, respectively. Also stated it remains on-track to deliver EPS of $16.75 and revenues of $7.1 billion for FY16.
F5 Networks (FFIV) reported better than expected Q2 EPS of $1.68 on mostly in-line revenues which rose 2.5% versus last year to $483.7 million. Additionally, management guided Q3 EPS better than expected at $1.77-1.80, but guided Q3 revenues worse than expected at $490-500 million.
Companies scheduled to report quarterly results tonight: AMD GOOG ETFC MRVL MXIM MSFT PFPT SPSC UCTT UIS V
Analyst actions:
CA was upgraded to Neutral from Underperform at Credit Suisse;
CHKP and FFIV were downgraded to Mkt Perform from Outperform at Raymond James,
WIT was downgraded to Sell from Neutral at Citigroup,
QCOM was downgraded to Neutral from Buy at Rosenblatt,
ERIC was downgraded to Neutral from Buy at BofA/Merrill,
IMPV was downgraded to Underweight from Equal Weight at Morgan Stanley,
INOV was downgraded to Neutral from Outperform at Robert W. Baird;
INTU was initiated with a Neutral at Credit Suisse,
PFSW was initiated with an Outperform at Northland Capital
2:08 pm TerraForm Global comments on SunEdison's chapter 11 restructuring filing, notes that TerraForm Global & its sister company are not part of the SunEdison (SUNE) bankruptcy (GLBL) :
TerraForm Global and its sister company, TerraForm Power (TERP), are not part of the SunEdison (SUNE) bankruptcy filing and have no plans to file for bankruptcy themselves
TerraForm Global believes that it has sufficient liquidity to operate its business. Although SunEdison's bankruptcy will present challenges, TerraForm Global expects to continue to operate in the ordinary course and to meet its financial obligations on a timely basis. In addition, TerraForm Global intends to coordinate with SunEdison so that the Company's facilities and their operations continue to perform uninterrupted
SunEdison has secured commitments for new capital totaling up to $300 mln in debtor-in-possession financing from a consortium of first and second lien lenders. Subject to Court approval, these financial resources will be made available to SunEdison to support its continuing business operations, minimize disruption to its worldwide projects and partnerships, and make necessary operational changes
TerraForm Global's corporate level revolving credit facility and indenture for its senior unsecured bonds do not include an event of default provision triggered by a SunEdison bankruptcy. In addition, as previously disclosed in the Company's 8-K filing from March 29, 2016, the majority of its existing power purchase agreements ("PPAs") do not include provisions that permit the offtake counterparty to terminate the contract in the event that SunEdison files for bankruptcy
9:40 am SunEdison confirms it has filed Chapter 11 bankruptcy (shares halted) (SUNE) :
The co announced that it has commenced a process to restructure its balance sheet and position the Company for the future. To facilitate this restructuring, SunEdison and certain of its domestic and international subsidiaries have filed voluntary petitions for reorganization under chapter 11 of the U.S. Bankruptcy Code in the Bankruptcy Court for the Southern District of New York.
SunEdison's publicly-traded yieldcos, TerraForm Power (TERP) and TerraForm Global (GLBL), are not part of the filing.SunEdison has secured commitments for new capital totaling up to $300 million in debtor-in-possession (:DIP) financing from a consortium of first and second lien lenders. Subject to Court approval, these financial resources will be made available to the Company to support its continuing business operations, minimize disruption to its worldwide projects and partnerships, and make necessary operational changes.
9:02 am Ultratech beats by $0.18, beats on revs (UTEK) :
Reports Q1 (Mar) earnings of $0.10 per share, excluding non-recurring items, $0.18 better than the two analyst estimate of ($0.08); revenues rose 7.9% year/year to $45.2 mln vs the $39.1 mln Capital IQ Consensus. "Our first quarter results demonstrate the broad applicability of our major product lines, laser spike annealing, advanced packaging, and inspection, for multiple applications. Our revenue and bookings momentum in the quarter provide a strong foundation for the remainder of fiscal 2016, particularly driven by LSA and the second wave of demand for 28nm production coming from Asian foundries."
8:34 am Sunworks CEO issues letter to shareholders; says prospects for 2016 look even stronger (SUNW) : "In 2015, each of the original operating entities we acquired, Solar United Network, MD Energy and Elite Solar, all achieved rapid organic growth, and prospects for 2016 look even stronger. We finished the year with contracted backlog of approximately $47.5 million, a record for our company. This foundation gives us a clear line of sight to achieving our conservative 2016 revenue guidance of $100 million. Just as important, we expect to deliver stronger profitability in 2016 as well."
8:13 am Silicom Limited misses by $0.07, beats on revs (limited coverage) (SILC) :
Reports Q1 (Mar) earnings of $0.41 per share, excluding non-recurring items, $0.07 worse than the single analyst estimate of $0.48; revenues rose 13.8% year/year to $21.4 mln vs the $20.64 mln single analyst estimate.
7:35 am Fairchild Semi misses by $0.04, beats on revs; Note: co previously announced it's being acquired by ON (FCS) :
Reports Q1 (Mar) earnings of $0.10 per share, excluding non-recurring items, $0.04 worse than the Capital IQ Consensus of $0.14; revenues fell 8.1% year/year to $327.0 mln vs the $323.6 mln Capital IQ Consensus."First quarter sales were largely as expected with normal seasonal demand patterns evident across all our end markets...Adjusted gross margin decreased sequentially due primarily to lower factory loadings as we reduced internal inventory by $20 million from the prior quarter."As previously announced in November 2015, FCS has agreed to be acquired by ON Semiconductor (ON) for $20 per share in cash. The two cos are working to obtain required regulatory approvals in connection with the transaction.
7:31 am Verizon reports EPS in-line, revs in-line; reaffirms FY16 EPS guidance; sees pressure on Q2 earnings due to the timing of cost reductions (VZ) :
Reports Q1 (Mar) earnings of $1.06 per share, in-line with the Capital IQ Consensus of $1.06; revenues rose 0.6% year/year to $32.17 bln vs the $32.48 bln Capital IQ Consensus. Excluding AOL (non-GAAP), which was not part of Verizon a year ago, total operating revenues declined 1.5 percent. AOL had its highest first-quarter revenues in the last five years. New revenue streams from IoT (Internet of Things) are growing, with revenues of ~$195 million in first-quarter 2016, a year-over-year increase of about 25 percent.
Wireless highlights Verizon reported 640,000 retail postpaid net additions in first-quarter 2016, a seasonally low-volume quarter. These net adds exclude all wholesale connections, including IoT. At the end of first-quarter 2016, Verizon had 112.6 million retail connections, a 3.7 percent year-over-year increase, and 107.2 million retail postpaid connections, a 4.4 percent year-over-year increase. Customer retention remained high, with retail postpaid churn at a low 0.96 percent in first-quarter 2016, a year-over-year improvement of 7 basis points. Segment operating income was $7.9 billion, and segment operating income margin was 35.8 percent. In first-quarter 2016, Verizon Wireless generated $10.2 billion in EBITDA (non-GAAP), a year-over-year increase of 1.7 percent. Segment EBITDA margin (non-GAAP) was 46.2 percent, compared with 44.8 percent in first-quarter 2015. Total revenues were $22.0 billion in first-quarter 2016, a decline of 1.5 percent compared with first-quarter 2015 as more customers continued to choose unsubsidized device payment plans. Service revenues plus installment billings increased 1.6 percent, comparing first-quarter 2016 with first-quarter 2015. The percentage of phone activations on installment plans grew to 68 percent in first-quarter 2016, compared with 67 percent in fourth-quarter 2015. The company expects this percentage to grow to 70 percent in second-quarter 2016.
Co reaffirms guidance for FY16, sees EPS of comparable to $3.99 in 2015, excluding non-recurring items, vs. $3.97 Capital IQ Consensus Estimate. Verizon continues to expect full-year 2016 adjusted earnings to be at a level comparable to the company's strong full-year 2015 adjusted earnings. However, given the status of labor contract negotiations, there will be pressure on second-quarter earnings due to the timing of cost reductions.
7:04 am Benchmark Electronics misses by $0.06, misses on revs; guides Q2 EPS below consensus, revs below consensus (BHE) :
Reports Q1 (Mar) earnings of $0.26 per share, excluding non-recurring items, $0.06 worse than the Capital IQ Consensus of $0.32; revenues fell 11.6% year/year to $549 mln vs the $573.44 mln Capital IQ Consensus. Q1 New program bookings in the first quarter were $110 to $140 million.Co issues downside guidance for Q2, sees EPS of $0.29-0.33, excluding non-recurring items, vs. $0.38 Capital IQ Consensus Estimate; sees Q2 revs of $570-600 mln vs. $626.82 mln Capital IQ Consensus Estimate.
7:03 am Celestica beats by $0.04, reports revs in-line; guides Q2 EPS in-line, revs in-line (CLS) :
Reports Q1 (Mar) earnings of $0.26 per share, $0.04 better than the Capital IQ Consensus of $0.22; revenues rose 4.2% year/year to $1.35 bln vs the $1.35 bln Capital IQ Consensus. Co issues in-line guidance for Q2, sees EPS of $0.25-0.31 vs. $0.27 Capital IQ Consensus Estimate; sees Q2 revs of $1.4-1.5 bln vs. $1.44 bln Capital IQ Consensus Estimate.
7:03 am iRobot mails letter to shareholders from its independent Director, Deborah Ellinger urging stockholders to vote for all Director nominees (IRBT) :
7:02 am Dana Holding misses by $0.09, misses on revs; guides FY16 EPS in-line, revs in-line (DAN) :
Reports Q1 (Mar) earnings of $0.34 per share, excluding non-recurring items, $0.09 worse than the Capital IQ Consensus of $0.43; revenues fell 9.9% year/year to $1.45 bln vs the $1.51 bln Capital IQ Consensus. Co issues in-line guidance for FY16, sees EPS of $1.65-1.75, excluding non-recurring items, vs. $1.70 Capital IQ Consensus Estimate; sees FY16 revs of $5.8-6.0 bln vs. $5.84 bln Capital IQ Consensus Estimate.Capital spending of $320 to $340 million; Free cash flow of $120 to $140 million.
4:15 pm Microsoft misses by $0.02, reports revs in-line; guides Q3 on call (MSFT) :
Reports Q3 (Mar) earnings of $0.62 per share, excluding non-recurring items, $0.02 worse than the Capital IQ Consensus of $0.64; revenues rose 1.6% year/year to $22.08 bln vs the $22.11 bln Capital IQ Consensus.
Productivity and Business Processes rev +1% to $6.5 bln vs. $6.4-6.6 bln guidance.
Office commercial products and cloud services revenue grew 7% in constant currency driven by Office 365 revenue growth of 63% in constant currency
Office consumer products and cloud services revenue grew 6% in constant currency with Office 365 consumer subscribers increasing to 22.2 million
Dynamics products and cloud services revenue grew 9% in constant currency with Dynamics CRM Online seat adds more than doubling year-over-year.
Intelligent Cloud rev +3% to $6.1 bln vs. $6.1-6.3 bln guidance
Server products and cloud services revenue increased 5% in constant currency driven by double-digit annuity revenue growth
Azure revenue grew 120% in constant currency with usage of Azure compute and Azure SQL database more than doubling year-over-year
Enterprise Mobility customers more than doubled year-over-year to over 27,000, and the installed base grew nearly 4x year-over-year.
Personal Computing revs +1% to $9.5 bln vs. $9.1-9.4 bln guidance.
Windows OEM revenue declined 2% in constant currency, outperforming the PC market, driven by higher consumer premium device mix
Surface revenue increased 61% in constant currency driven by Surface Pro 4 and Surface Book
Phone revenue declined 46% in constant currency
Xbox Live monthly active users grew 26% year-over-year to 46 million.
4:11 pm Ultra Clean Holdings misses by $0.02, beats on revs; guides Q2 EPS in-line, revs above consensus (UCTT) :
Reports Q1 (Mar) net of breakeven, excluding non-recurring items, $0.02 worse than the Capital IQ Consensus of $0.02; revenues fell 10.5% year/year to $112.2 mln vs the $109.86 mln Capital IQ Consensus. Co issues guidance for Q2, sees EPS of $0.05-0.08 vs. $0.06 Capital IQ Consensus Estimate; sees Q2 revs of $123-128 mln vs. $114.58 mln Capital IQ Consensus Estimate.
4:10 pm E*TRADE beats by $0.10, reports revs in-line (ETFC) :
Reports Q1 (Mar) earnings of $0.43 per share, $0.10 better than the Capital IQ Consensus of $0.33; revenues rose 7.0% year/year to $472 mln vs the $475.14 mln Capital IQ Consensus.
Reports Daily Average Revenue Trades (DARTs) of 165,000.Net new brokerage accounts of 45,000 and an annualized attrition rate of 7.3%, excluding the impact of shutting down the Company's Hong Kong and Singapore operations.Reports allowance for loan losses of $322 mln resulting in a benefit to provision for loan losses of $34 mln.Co utilized $301 mln to repurchase 13.1 mln shares at an average price of $23.01, bringing the total utilization under the company's program to $351 mln.
4:03 pm Maxim Integrated misses by $0.01, reports revs in-line; guides Q4 EPS in-line, revs in-line (MXIM) :
Reports Q3 (Mar) earnings of $0.41 per share, $0.01 worse than the Capital IQ Consensus of $0.42; revenues fell 3.8% year/year to $555 mln vs the $555.35 mln Capital IQ Consensus. Co issues in-line guidance for Q4, sees EPS of $0.45-0.51 vs. $0.47 Capital IQ Consensus Estimate; sees Q4 revs of $555-595 mln vs. $568.85 mln Capital IQ Consensus Estimate. The Company's 90-day backlog at the beginning of the June quarter of 2016 was $370 million.
4:15 pm : The stock market ended the Thursday affair on a lower note as the major averages pulled back after a recent run higher. Today's downturn can be attributed to retreating oil prices, mixed earnings results, and the underperformance of the heavily-weighed financial sector (-1.0%). The Dow Jones Industrial Average (-0.6%) finished its day behind both the S&P 500 (-0.5%) and the Nasdaq Composite (-0.1%).
Equity indices began the day under pressure as an overnight retreat in oil weighed. The dip in crude preceded the latest policy statement from the European Central Bank, which left the central bank's interest rate corridor unchanged. Additionally, ECB President Draghi struck a dovish tone in his remarks as he reiterated that rates will remain at their present levels or lower for an extended period of time. Furthermore, Mr. Draghi said financing conditions in the eurozone improved in March, but the central bank head believes that inflation could turn negative in the coming months.
On the home front, investors turned their attention towards the slew of mixed quarterly earnings reports released since yesterday's close. However, despite some better-than-expected readings the major averages were unable to maintain their recent momentum. The benchmark index was unable to reach yesterday's high (2111.05) or maintain its position near yesterday's low (2096.32).
By the end of the session, nine sectors traded in negative territory with countercyclical telecom services (-2.7%), utilities (-2.2%), and consumer staples (-1.7%) outpacing the losses in the broader market. Meanwhile, financials (-1.0%), and energy (-0.5%) registered slimmer losses. On the flip side, the heavyweight health care space (+0.6%) ended its day as the lone advancer.
In the lightly-weighted telecom services sector (-2.7%), large cap component Verizon (VZ 50.03, -1.72) weighed after hinting that its second quarter earnings may be pressured due to timing of certain cost reductions in relation to the CWA and IBEW strike.
Insurance names underperformed in the financial sector (-1.0%) as the sub-group moved lower in sympathy with Travelers (TRV 108.79, -7.01). The stock fell 6.1% after missing bottom-line estimates for the first quarter. The broader sector trimmed its April advance to 3.5%. On the flipside, Bank of New York Mellon (BK 40.70, +0.98) gained 2.5% after reporting bottom-line results above analysts' estimates.
In the industrial space (-0.3%), relative weakness from airlines outweighed an uptick in rail names. The airline sub-group traded lower in sympathy with United Continental (UAL 52.76, -5.84), which tumbled 10.0% after lowering passenger revenue guidance for the second quarter. Separately, Union Pacific (UNP 87.32, +3.47) rallied 4.1% on mixed earnings, with investors focusing on a bottom-line beat. The Dow Jones Transportation Average (-1.2%) trimmed its weekly gain to 0.4%.
The biotechnology sub-group outperformed in the health care space (+0.6%), thanks to Biogen (BIIB 279.60, +13.71). The company reported a bottom-line beat on in-line revenue ahead of today's opening bell. Biogen also reported that revenue grew 6.7% year-over-year thanks in part to a 15.0% increase in revenue from Tecfidera.
The influential technology sector (-0.1%) ended near its flat line as Apple (AAPL 105.97, -1.16) underperformed following Qualcomm's (QCOM 51.67, -0.42) mixed guidance for the June quarter. The below-consensus estimate is believed to be linked to weakness in smartphone components. Meanwhile, Microsoft (MSFT 55.78, +0.19) and Alphabet (GOOG 759.14, +6.47) outperformed ahead of this evening's quarterly earnings reports.
The U.S. Dollar Index (94.64, +0.15) ended its day above its flat line as the greenback recovered from sharp losses against the euro. The euro/dollar pair jumped to 1.1381 immediately following remarks from ECB President Mario Draghi. However, this move would prove to be short-lived as the currency pair retraced its way down to negative territory at 1.1288 (-0.1%). Separately, the dollar lost 0.4% against the yen (109.45).
Despite the larger move in the equities market, Treasuries managed to remain in a narrow range with the yield on the 10-yr note fluctuating between 1.86% and 1.88%. The yield on the benchmark note settled at 1.86% (+2 bps).
Today's participation was above the recent average with more than 987 million shares changing hands at the NYSE floor.
Today's economic data included weekly initial claims, the Philadelphia Fed Survey for April, FHFA Housing Price Index for February, and March Leading Indicators:
Initial claims were 247,000 for the week ending April 16 (Briefing.com consensus 263,000), a decrease of 6,000 from the prior week's unrevised level.
The latest initial claims reading, which was not influenced by special factors, is the lowest level of initial claims since November 24, 1973 and marked the 59th straight week claims have been below 300,000, which is the longest streak since 1973!
The claims data is a clear reflection of a strong labor market -- or so it would seem. The other important piece to corroborate that statement -- average hourly earnings growth -- has yet to follow convincing suit.
With the latest reading, the four-week moving average for initial claims fell to 260,500 from 265,000.
Continuing claims for the week ending April 9 dropped by 39,000 to 2.137 million, which is the lowest level since November 4, 2000.
That lowered the four-week moving average to 2.169 million, which is the lowest level since November 11, 2000
The Philadelphia Fed Index was a big disappointment. After turning positive in March (+12.4) following six straight negative readings, it dropped back into negative territory in April (-1.6; Briefing.com consensus +9.9).
There were several key elements making this a particularly disappointing report: (1) the new orders index decreased from 15.7 to zero (2) the shipments index fell from 22.1 to -10.8 (3) the employment index decreased 17 points and registered its fourth straight negative reading (-18.5) and (4) this is a second quarter report showing a relapse in growth of the region's manufacturing sector.
The latter point notwithstanding, the diffusion index for future general activity increased from 28.8 to 42.2.
The FHFA Housing Price Index for February rose 0.4% month-over-month after increasing a revised 0.4% (from 0.5%) in January.
The Leading Economic Index increased 0.2% in March (Briefing.com consensus+ 0.4%). The added disappointment in the report is that February was revised lower to show a 0.1% decline after an originally reported 0.1% increase.
The biggest contributors to the March increase were stock prices (0.24 percentage points) and the interest rate spread (0.17 percentage points).
They were offset to a certain degree by building permits, which subtracted 0.25 percentage points.
The building permits impact effectively accounted for much of the difference between the consensus estimate and the actual number. The building permits data for March was released earlier in the week.
The other two components estimated by the Conference Board were manufacturers' new orders and nondefense capital goods orders excluding aircraft.
Neither was accorded much strength as the estimated contributions were 0.01 and 0.03 percentage points, respectively.
In the six-month period ending March 2016, the leading economic index increased 0.7% versus 1.5% in the previous six months.
Separately, the Coincident Economic Index remained unchanged in March while the Lagging Economic Index increased 0.4%.
There is no economic data of note scheduled for release tomorrow.
Dow Jones +3.2% YTD
S&P 500 +2.3% YTD
Russell 2000 +0.0% YTD
Nasdaq Composite -1.2% YTD
DJ30 -113.75 NASDAQ -2.24 SP500 -10.92 NASDAQ Adv/Vol/Dec 1323/1.575 bln/1498 NYSE Adv/Vol/Dec 1089/987.0 mln/1905
3:30 pm :
The dollar index stages a brief afternoon rally before drifting slightly off its high of the day, currently up +0.1% at 94.61 & weighing on commodities
Commodities, as measured by the Bloomberg Commodity Index, are down -0.7% at 83.59
Crude oil sees a notable downtrend, consolidating near its low of the day and closing slightly above this level
June Crude Oil futures fell $0.97 (-2.2%) to $43.18/barrel
Natural gas exhibited notable volatility, initially selling off after the release of EIA storage data before rebounding and then drifting lower, closing unchanged on the day
May Natural Gas closed flat at $2.07/MMBtu
Natural gas inventory showed a build of +7 bcf vs expectations for inventory to be a build of ~0-6 bcf
Working gas in storage was 2,484 Bcf as of Friday, April 15, 2016, according to EIA estimates. This represents a net increase of +7 Bcf from the previous week. Stocks were 881 Bcf higher than last year at this time and 811 Bcf above the five-year average of 1,673 Bcf. At 2,484 Bcf, total working gas is within the five-year historical range
In precious metals, gold initially plummets at the open of pit trading and drifts lower all day, consolidating near the lows for the day
June gold ended today's session down $4.20 (-0.3%) to $1250.20/oz
Silver trends and closes lower on the day
May silver closed today's session $0.06 lower (-0.4%) at $17.09/oz
Base metal copper trades sideways, managing to carve out a modest gain near the close of pit trading
May copper closed $0.01 higher (+0.5%) at $2.25/lb
When the final bell rang, the markets were modestly lower. Trading ended with the Dow Jones Industrial Average as the worst performer (helped lower by the -2.2% loss in June Crude Oil Futures), shedding 113.75 points (-0.63%) to close 17982.52. The S&P 500 was down 10.92 points (-0.52%) to 2091.48. To round out the trio, the Nasdaq Composite was lower by 2.24 points (-0.05%) to 4945.89. Today's session began on a modestly lower note as participants digested remarks from ECB President Draghi. Mr. Draghi's remarks generally fell in-line with market expectations, as he stated that interest rates will likely remain lower for longer. President Draghi also stated that financing conditions generally improved in the eurozone in March, but that inflation could turn negative in the coming months.
Market data today came in the form of the initial claims reading for the week ending April 16 which showed a decline of 6,000 to 247,000. Continuing claims for the week ending April 9 were down by 39,000 to 2.137 million -- the lowest level since November 4, 2000. The Philadelphia Fed Index was a disappointment, as after turning positive in March (+12.4), it dropped back into negative territory in April (-1.6). The FHFA Housing Price Index for February rose 0.4% month-over-month after increasing a revised 0.4% (from 0.5%) In January. Finally, the Leading Economic Index increased 0.2% in March, and adding to the disappointment in the report was that February was revised lower to show a 0.1% decline after an originally reported 0.1% increase.
Trading in the Technology (XLK 44.21, -0.16 -0.36%) sector was in the red for pretty much the entirety of the day, save for a few brief moments in the first two hours of action. Component F5 Networks (FFIV 102.54, +5.38 +5.54%) was the best performer in the sector as the company reported better than expected Q2 EPS and issued mixed Q3 guidance; additionally, FFIV's BoDs authorized an additional $1 billion to the common stock repurchase program. Other sectors as measured by the S&P closed XLV +0.59%, XLI -0.25%, XLY -0.35%, XLB -0.45%, XLE -0.59%, XLF -0.89%, IYZ -1.61%, XLP -1.64%, XLU -2.09% with Healthcare the only sector managing gains and Utilities and Consumer Staples lagging.
In the S&P 500 Information Technology (736.71, -0.87 -0.12%) sector, action was modestly to the downside as the sector hovered near flat lines for the majority of the session. Component Alliance Data (ADS 202.60, -15.32 -7.03%) was the worst performer in the sector as the company reported mixed Q1 results and issued weak guidance for the Q2 period. Other names in the space which underperformed included LRCX -2.24%, PAYX -2.06%, FIS -1.82%, APH -1.71%, HPQ -1.64%, SWKS -1.58%, INTU -1.39%, KLAC -1.34%, QRVO -1.28%, TSS -1.27%, AVGO -1.23%, FISV -1.16%, AAPL -1.08%.
Other notable news items among sector components:
In addition to reporting quarterly results, F5 Networks' (FFIV) Board of Directors announced the authorization of an additional $1 billion for FFIV's common stock share repurchase program.
Qualcomm (QCOM 51.67, -0.42 -0.81%) signed a 3G/4G Chinese patent license agreement with Hisense, resolving arbitration dispute over licensing terms.
Onvia (ONVI 3.47, -0.01 -0.29%) announced integration capabilities with Salesforce (CRM 77.15, +1.01 +1.33%). Clients can now easily export Onvia leads to Salesforce, enabling their teams to respond more quickly and efficiently.
Box (BOX 13.00, +0.21 +1.64%) and Cognizant (CTSH 60.05, -0.04 -0.07%) announced a collaboration that will help enterprises transform the way they work with Box Platform.
Acorns raised $30 million in financing, including strategic investments from PayPal (PYPL 40.10, +0.02 +0.05%) and Rakuten Fintech Fund.
MasterCard (MA 97.54, -0.36 -0.37%) and the MLB announced an extension of their longstanding partnership agreement. The expanded partnership agreement provides MasterCard the presenting sponsorship role beginning with the 2016 All-Star Game, as well as increased opportunity to deliver advanced payment technologies to baseball fans.
Elsewhere in the tech space:
SunEdison (SUNE 0.33, -0.00 -0.33%) confirmed it has filed Chapter 11 bankruptcy. The company noted yieldcos TerraForm Power (TERP 10.46, +0.60 +6.09%) and TerraForm Global (GLBL 2.99, +0.39 +15.00%) are not part of the filing.Later, both TERP and GLBL announced they had 'no plans to file for bankruptcy themselves.' Both stated they still have sufficient liquidity to operate their respective businesses. In addition to reporting quarterly results, Ericsson (ERIC 8.27, -1.48 -15.18%) announced certain structural changes. Among these - a new organizational structure will be implemented July 1, 2016 whereby the company will have five businesses and one dedicated customer group. Additionally, ERIC announced certain appointments to the ERIC Executive Leadership Team and regional heads.
Vectrus (VEC 173.52, +0.72 +0.42%) received a $12 million telecom contract for the USAF in Europe.
Plexus' (PLXS 41.82, +3.24 +8.40%) CEO Dean Foate to retire at end of FY16. COO Todd Kelsey will become CEO on October 2.
Smiths Group (SMGZY 16.79, +0.56 +3.45%) acquired Morpho Detection from Safran S.A. (SAFRY 17.02, -0.42 -2.41%) for $710 million.
PTC (PTC 37.55, +3.34 +9.76%) disclosed recent shareholder lawsuit as well as investigation by the China Administration for Industry and Commerce.
In reaction to quarterly results:
Verizon (VZ 50.03, -1.72 -3.32%) reported in-line Q1 EPS of $1.06 on in-line revenues which rose 0.6% versus last year to $32.17 billion. Additionally, VZ reported 640,000 postpaid net additions in the quarter. Looking ahead, VZ reaffirmed FY16 EPS guidance of comparable to $3.99 in 2015.
Qualcomm (QCOM) reported better than expected Q2 EPS and revenues of $1.04 and $5.55 billion, respectively. Additionally, QCOM issued in-line guidance for Q3 EPS and revenues in the range of $0.90-1.00 and $5.2-6.0 billion, respectively.
Ericsson (ERIC) reported worse than expected Q1 EPS and revenues of $0.87 and $52.2 billion, respectively.
Citrix Systems (CTXS 84.03, +3.51 +4.36%) reported better than expected Q1 EPS and revenues of $1.18 and $826 million, respectively. CTXS also guided Q1 EPS better than expected at $1.12-1.15 with revenue expectations in-line with anticipations at $810-820 million. Looking ahead, CTXS sees FY16 EPS and revenues better than expected at $4.90-5.00 and $3.34-3.36 billion, respectively.
Alliance Data (ADS) reported better than expected Q1 EPS and in-line revenues of $3.84 anf $1.68 billion, respectively. Additionally, the company issued tepid guidance for the Q2 period's EPS and revenue numbers -- $3.58 and $1.62 billion, respectively. Also stated it remains on-track to deliver EPS of $16.75 and revenues of $7.1 billion for FY16.
F5 Networks (FFIV) reported better than expected Q2 EPS of $1.68 on mostly in-line revenues which rose 2.5% versus last year to $483.7 million. Additionally, management guided Q3 EPS better than expected at $1.77-1.80, but guided Q3 revenues worse than expected at $490-500 million.
Companies scheduled to report quarterly results tonight: AMD GOOG ETFC MRVL MXIM MSFT PFPT SPSC UCTT UIS V
Analyst actions:
CA was upgraded to Neutral from Underperform at Credit Suisse;
CHKP and FFIV were downgraded to Mkt Perform from Outperform at Raymond James,
WIT was downgraded to Sell from Neutral at Citigroup,
QCOM was downgraded to Neutral from Buy at Rosenblatt,
ERIC was downgraded to Neutral from Buy at BofA/Merrill,
IMPV was downgraded to Underweight from Equal Weight at Morgan Stanley,
INOV was downgraded to Neutral from Outperform at Robert W. Baird;
INTU was initiated with a Neutral at Credit Suisse,
PFSW was initiated with an Outperform at Northland Capital
2:08 pm TerraForm Global comments on SunEdison's chapter 11 restructuring filing, notes that TerraForm Global & its sister company are not part of the SunEdison (SUNE) bankruptcy (GLBL) :
TerraForm Global and its sister company, TerraForm Power (TERP), are not part of the SunEdison (SUNE) bankruptcy filing and have no plans to file for bankruptcy themselves
TerraForm Global believes that it has sufficient liquidity to operate its business. Although SunEdison's bankruptcy will present challenges, TerraForm Global expects to continue to operate in the ordinary course and to meet its financial obligations on a timely basis. In addition, TerraForm Global intends to coordinate with SunEdison so that the Company's facilities and their operations continue to perform uninterrupted
SunEdison has secured commitments for new capital totaling up to $300 mln in debtor-in-possession financing from a consortium of first and second lien lenders. Subject to Court approval, these financial resources will be made available to SunEdison to support its continuing business operations, minimize disruption to its worldwide projects and partnerships, and make necessary operational changes
TerraForm Global's corporate level revolving credit facility and indenture for its senior unsecured bonds do not include an event of default provision triggered by a SunEdison bankruptcy. In addition, as previously disclosed in the Company's 8-K filing from March 29, 2016, the majority of its existing power purchase agreements ("PPAs") do not include provisions that permit the offtake counterparty to terminate the contract in the event that SunEdison files for bankruptcy
9:40 am SunEdison confirms it has filed Chapter 11 bankruptcy (shares halted) (SUNE) :
The co announced that it has commenced a process to restructure its balance sheet and position the Company for the future. To facilitate this restructuring, SunEdison and certain of its domestic and international subsidiaries have filed voluntary petitions for reorganization under chapter 11 of the U.S. Bankruptcy Code in the Bankruptcy Court for the Southern District of New York.
SunEdison's publicly-traded yieldcos, TerraForm Power (TERP) and TerraForm Global (GLBL), are not part of the filing.SunEdison has secured commitments for new capital totaling up to $300 million in debtor-in-possession (:DIP) financing from a consortium of first and second lien lenders. Subject to Court approval, these financial resources will be made available to the Company to support its continuing business operations, minimize disruption to its worldwide projects and partnerships, and make necessary operational changes.
9:02 am Ultratech beats by $0.18, beats on revs (UTEK) :
Reports Q1 (Mar) earnings of $0.10 per share, excluding non-recurring items, $0.18 better than the two analyst estimate of ($0.08); revenues rose 7.9% year/year to $45.2 mln vs the $39.1 mln Capital IQ Consensus. "Our first quarter results demonstrate the broad applicability of our major product lines, laser spike annealing, advanced packaging, and inspection, for multiple applications. Our revenue and bookings momentum in the quarter provide a strong foundation for the remainder of fiscal 2016, particularly driven by LSA and the second wave of demand for 28nm production coming from Asian foundries."
8:34 am Sunworks CEO issues letter to shareholders; says prospects for 2016 look even stronger (SUNW) : "In 2015, each of the original operating entities we acquired, Solar United Network, MD Energy and Elite Solar, all achieved rapid organic growth, and prospects for 2016 look even stronger. We finished the year with contracted backlog of approximately $47.5 million, a record for our company. This foundation gives us a clear line of sight to achieving our conservative 2016 revenue guidance of $100 million. Just as important, we expect to deliver stronger profitability in 2016 as well."
8:13 am Silicom Limited misses by $0.07, beats on revs (limited coverage) (SILC) :
Reports Q1 (Mar) earnings of $0.41 per share, excluding non-recurring items, $0.07 worse than the single analyst estimate of $0.48; revenues rose 13.8% year/year to $21.4 mln vs the $20.64 mln single analyst estimate.
7:35 am Fairchild Semi misses by $0.04, beats on revs; Note: co previously announced it's being acquired by ON (FCS) :
Reports Q1 (Mar) earnings of $0.10 per share, excluding non-recurring items, $0.04 worse than the Capital IQ Consensus of $0.14; revenues fell 8.1% year/year to $327.0 mln vs the $323.6 mln Capital IQ Consensus."First quarter sales were largely as expected with normal seasonal demand patterns evident across all our end markets...Adjusted gross margin decreased sequentially due primarily to lower factory loadings as we reduced internal inventory by $20 million from the prior quarter."As previously announced in November 2015, FCS has agreed to be acquired by ON Semiconductor (ON) for $20 per share in cash. The two cos are working to obtain required regulatory approvals in connection with the transaction.
7:31 am Verizon reports EPS in-line, revs in-line; reaffirms FY16 EPS guidance; sees pressure on Q2 earnings due to the timing of cost reductions (VZ) :
Reports Q1 (Mar) earnings of $1.06 per share, in-line with the Capital IQ Consensus of $1.06; revenues rose 0.6% year/year to $32.17 bln vs the $32.48 bln Capital IQ Consensus. Excluding AOL (non-GAAP), which was not part of Verizon a year ago, total operating revenues declined 1.5 percent. AOL had its highest first-quarter revenues in the last five years. New revenue streams from IoT (Internet of Things) are growing, with revenues of ~$195 million in first-quarter 2016, a year-over-year increase of about 25 percent.
Wireless highlights Verizon reported 640,000 retail postpaid net additions in first-quarter 2016, a seasonally low-volume quarter. These net adds exclude all wholesale connections, including IoT. At the end of first-quarter 2016, Verizon had 112.6 million retail connections, a 3.7 percent year-over-year increase, and 107.2 million retail postpaid connections, a 4.4 percent year-over-year increase. Customer retention remained high, with retail postpaid churn at a low 0.96 percent in first-quarter 2016, a year-over-year improvement of 7 basis points. Segment operating income was $7.9 billion, and segment operating income margin was 35.8 percent. In first-quarter 2016, Verizon Wireless generated $10.2 billion in EBITDA (non-GAAP), a year-over-year increase of 1.7 percent. Segment EBITDA margin (non-GAAP) was 46.2 percent, compared with 44.8 percent in first-quarter 2015. Total revenues were $22.0 billion in first-quarter 2016, a decline of 1.5 percent compared with first-quarter 2015 as more customers continued to choose unsubsidized device payment plans. Service revenues plus installment billings increased 1.6 percent, comparing first-quarter 2016 with first-quarter 2015. The percentage of phone activations on installment plans grew to 68 percent in first-quarter 2016, compared with 67 percent in fourth-quarter 2015. The company expects this percentage to grow to 70 percent in second-quarter 2016.
Co reaffirms guidance for FY16, sees EPS of comparable to $3.99 in 2015, excluding non-recurring items, vs. $3.97 Capital IQ Consensus Estimate. Verizon continues to expect full-year 2016 adjusted earnings to be at a level comparable to the company's strong full-year 2015 adjusted earnings. However, given the status of labor contract negotiations, there will be pressure on second-quarter earnings due to the timing of cost reductions.
7:04 am Benchmark Electronics misses by $0.06, misses on revs; guides Q2 EPS below consensus, revs below consensus (BHE) :
Reports Q1 (Mar) earnings of $0.26 per share, excluding non-recurring items, $0.06 worse than the Capital IQ Consensus of $0.32; revenues fell 11.6% year/year to $549 mln vs the $573.44 mln Capital IQ Consensus. Q1 New program bookings in the first quarter were $110 to $140 million.Co issues downside guidance for Q2, sees EPS of $0.29-0.33, excluding non-recurring items, vs. $0.38 Capital IQ Consensus Estimate; sees Q2 revs of $570-600 mln vs. $626.82 mln Capital IQ Consensus Estimate.
7:03 am Celestica beats by $0.04, reports revs in-line; guides Q2 EPS in-line, revs in-line (CLS) :
Reports Q1 (Mar) earnings of $0.26 per share, $0.04 better than the Capital IQ Consensus of $0.22; revenues rose 4.2% year/year to $1.35 bln vs the $1.35 bln Capital IQ Consensus. Co issues in-line guidance for Q2, sees EPS of $0.25-0.31 vs. $0.27 Capital IQ Consensus Estimate; sees Q2 revs of $1.4-1.5 bln vs. $1.44 bln Capital IQ Consensus Estimate.
7:03 am iRobot mails letter to shareholders from its independent Director, Deborah Ellinger urging stockholders to vote for all Director nominees (IRBT) :
7:02 am Dana Holding misses by $0.09, misses on revs; guides FY16 EPS in-line, revs in-line (DAN) :
Reports Q1 (Mar) earnings of $0.34 per share, excluding non-recurring items, $0.09 worse than the Capital IQ Consensus of $0.43; revenues fell 9.9% year/year to $1.45 bln vs the $1.51 bln Capital IQ Consensus. Co issues in-line guidance for FY16, sees EPS of $1.65-1.75, excluding non-recurring items, vs. $1.70 Capital IQ Consensus Estimate; sees FY16 revs of $5.8-6.0 bln vs. $5.84 bln Capital IQ Consensus Estimate.Capital spending of $320 to $340 million; Free cash flow of $120 to $140 million.
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