From Briefing.com: 4:35 pm : Stocks finished this holiday-shortened week on a high note, thanks largely to another big batch of better-than-expected earnings. Broad buying during the past two sessions gave the Dow and S&P 500 weekly gains of little more than 1%, but the Nasdaq Composite climbed 2% this week.
The Nasdaq outperformed its counterparts during the past couple of sessions with help from large-cap tech issues. Intel (INTC 21.46, +0.05) was a leader among tech issues in the prior session, but today Apple (AAPL 350.70, +8.29) and Qualcomm (QCOM 56.94, +1.67) were primary benefactors of the tech sector's bounce. As a group, tech stocks scored a 1.0% gain.
Materials stocks lack the collective weight of tech issues, but their 1.1% gain didn't go unnoticed. DuPont (DD 55.91, +0.54) was a strong performer following its upside earnings surprise. Better-than-expected results also helped Newmont Mining (NEM 59.23, +0.38) settle higher, although the stock surrendered some of its gains.
Financials put together their best gain of the week by advancing 0.6%. Dow component Travelers (TRV 61.32, +2.19) was a leader as its shares climbed to a record year high with help from strong quarterly results. Consumer finance play Capital One (COF 53.26, +2.73) also surged, but peer American Express (AXP 47.11, +0.11) put together only a modest gain amid a positive earnings surprise. Morgan Stanley (MS 26.48, +0.44) also had a stronger-than-expected quarter, but the stock forfeited some of its gains.
Blue chips General Electric (GE 19.95, -0.45), Verizon (VZ 36.91, -0.88), and McDonalds (MCD 76.91, -1.49) both had better-than-expected bottom lines, but neither scored a gain. GE actually augmented its report with a dividend hike.
Pfizer (PFE 19.79, -0.60) fell sharply after reports indicated that deaths were reported in relation to one of the company's drug tests. Amgen (AMGN 53.69, -2.49) was also a source of weakness following its latest quarterly report, but an upside earnings surprise from UnitedHealth (UNH 47.81, +3.57) offered some support to the overall health care sector, which settled with a tame gain of 0.3%.
Data, although generally disappointing, did little to disrupt today's broad market advance. Initial jobless claims for the week ended April 16 totaled 403,000, which is greater than the 390,000 claims that had been expected, on average, among economists polled by Briefing.com. Week over week, initial claims came down by 13,000. As for continuing claims, they fell 7,000 week over week to 3.70 million.
The latest Philadelphia Fed Index for April dove sharply to 18.5 from 43.4 in the prior month. It had been expected to come in at 33.0.
Leading Indicators for March increased 0.4%. That is down from the 0.8% increase in the prior month, but greater than the 0.2% increase that had been widely expected.
As a reminder, the observance of Good Friday will keep U.S. markets closed tomorrow.
Advancing Sectors: Materials (+1.1%), Tech (+1.0%), Consumer Discretionary (+0.6%), Financials (+0.6%), Energy (+0.6%), Health Care (+0.3%), Telecom (+0.3%), Utilities (+0.2%), Industrials (+0.2%)
Unchanged: Consumer Staples
Declining Sectors: (None)DJ30 +52.45 NASDAQ +17.65 NQ100 +0.8% R2K +0.7% SP400 +0.6% SP500 +7.02 NASDAQ Adv/Vol/Dec 1532/1.87 bln/1040 NYSE Adv/Vol/Dec 1960/811 mln/1022
5:14PM Ixia sees Q2 revenues in the range of $78-82 mln, Thomson Reuters consensus $81.35 mln; sees Q2 EPS in the range of $0.14-0.17, Thomson Reuters consensus $0.16... non-GAAP gross margin between 78-80% (XXIA) :
4:04PM Ixia beats by $0.02, reports revs in-line (XXIA) 15.44 +0.19 : Reports Q1 (Mar) earnings of $0.16 per share, excluding non-recurring items, $0.02 better than the Thomson Reuters consensus of $0.14; revenues rose 26.7% year/year to $78.6 mln vs the $78.7 mln consensus.
4:27PM Cymer beats by $0.13, beats on revs; guides Q2 revs in-line (CYMI) 52.39 -0.44 : Reports Q1 (Mar) earnings of $0.94 per share, $0.13 better than the Thomson Reuters consensus of $0.81; revenues rose 35.7% year/year to $154.4 mln vs the $150.3 mln consensus. Co issues in-line guidance for Q2, sees Q2 revs of ~$157 mln vs. $156.94 mln Thomson Reuters consensus.
4:19PM Advanced Micro beats by $0.03, reports revs in-line; sees Q2 rev flat to slightly down QoQ, in-line (AMD) 8.71 +0.08 : Reports Q1 (Mar) earnings of $0.08 per share, excluding non-recurring items, $0.03 better than the Thomson Reuters consensus of $0.05; revenues rose 2.5% year/year to $1.61 bln vs the $1.61 bln consensus. Co sees Q2 rev flat to slightly down vs. the -1.4% consensus; Q1 GAAP gross margin of 42.8% vs. the 44.8% consensus. "First quarter operating results were highlighted by strong demand for our first generation of AMD Fusion Accelerated Processing Units (APUs). APU unit shipments greatly exceeded our expectations, and we are excited to build on that momentum now that we are shipping our 'Llano' APU."
4:09PM SanDisk beats by $0.03, beats on revs (SNDK) 48.99 +0.54 : Reports Q1 (Mar) earnings of $1.03 per share, excluding non-recurring items, $0.03 better than the Thomson Reuters consensus of $1.00; revenues rose 19.2% year/year to $1.29 bln vs the $1.26 bln consensus. Co reports Q1 non-GAAP gross margins of 43.1% vs 43.0% consensus. "Our embedded mobile business drove growth in the first quarter, and SanDisk executed well to deliver strong business results," said Sanjay Mehrotra, President and CEO. "We have been actively managing our supply chain following the recent events in Japan and believe we remain on track to deliver a strong 2011 for SanDisk."
4:06PM Lattice Semi reports EPS in-line, beats on revs; guides Q3 rev above consensus; gross margin in-line (LSCC) 6.32 +0.12 : Reports Q1 (Mar) earnings of $0.09 per share, in-line with the Thomson Reuters consensus of $0.09; revenues rose 13.0% year/year to $82.6 mln vs the $76.5 mln consensus. Lattice Semi sees Q2 rev flat to up 5% QoQ consensus calling for $79.3, with gross margin of 60-62% vs. 60.2% consensus. "This was a strong quarter for us across the board. Positive demand trends in the consumer, and industrial and other end markets were bolstered by a pick-up in the communications market. Of note, revenue came in well above the high-end of our prior guidance. Based on customer feedback, we believe that only $1 million to $2 million of the upside came from unexpected, Japan-related 'safety stock' buying; the rest of the upside reflects the continued strength in our business, along with higher than anticipated demand from our mainstream products. Adding to our momentum, we are pleased with the positive response from customers for our recently launched low power, low cost MachXO2."
4:03PM Maxim Integrated reports EPS in-line, revs in-line; guides Q4 EPS in-line, revs in-line (MXIM) 26.15 +0.56 : Reports Q3 (Mar) earnings of $0.40 per share, in-line with the Thomson Reuters consensus of $0.40; revenues rose 19.3% year/year to $606.8 mln vs the $605.5 mln consensus. Co issues in-line guidance for Q4, sees EPS of $0.40-0.44 vs. $0.42 Thomson Reuters consensus; sees Q4 revs of $610-640 mln vs. $619.74 mln Thomson Reuters consensus. Co reports their 90 day backlog at the beginning of the fourth fiscal quarter was $462 million.
9:19AM Celestica beats by $0.02, reports revs in-line; guides Q2 EPS, revs in-line; see 7:04 comment for purchase of BRKS's semi-equip. contract manufacturing ops. (CLS) 10.58 : Reports Q1 (Mar) earnings of $0.25 per share, excluding non-recurring items, $0.02 better than the Thomson Reuters consensus of $0.23; revenues rose 18.6% year/year to $1.8 bln vs the $1.79 bln consensus. Co issues in-line guidance for Q2, sees EPS of $0.22-0.28, excluding non-recurring items, vs. $0.25 Thomson Reuters consensus; sees Q2 revs of $1.75-1.90 bln vs. $1.82 bln Thomson Reuters consensus. Co also announced that it has agreed to acquire the semiconductor equipment contract manufacturing operations of Brooks Automation (BRKS), see 7:04 comment.
8:16AM Ultratech beats by $0.03, beats on revs (UTEK) 27.02 : Reports Q1 (Mar) earnings of $0.30 per share, $0.03 better than the Thomson Reuters consensus of $0.27; revenues rose 72.4% year/year to $47.4 mln vs the $46.1 mln consensus.
In the latest move to expand its global market share in Fibre Channel switching, QLogic Corp. (QLGC) announced that its 5800V Series and 9000 Series 8Gb Fibre Channel stackable switches will be available immediately from Huawei Symantec, a global provider of network security and storage appliance solutions to enterprise customers around the globe.
8:02AM Cypress Semi beats by $0.01, beats on revs; Q2 guidance to be better than seasonal (CY) 19.44 +1.14 : Reports Q1 (Mar) earnings of $0.24 per share, $0.01 better than the Thomson Reuters consensus of $0.23; revenues rose 15.2% year/year to $233.1 mln vs the $228.9 mln consensus. Co says rev growth was driven by record TrueTouch touchscreen controller shipments. Co also says that Q2 guidance to be better than seasonal.
7:34AM Verizon beats by $0.01, reports revs in-line; reaffirms FY11 EPS, rev growth guidance (VZ) 37.79 : Reports Q1 (Mar) earnings of $0.51 per share, $0.01 better than the Thomson Reuters consensus of $0.50; revenues rose 0.3% year/year to $26.99 bln vs the $26.86 bln consensus. Co reaffirms guidance for FY11, sees EPS +5-8% to ~$2.18-2.25, excluding non-recurring items, vs. $2.22 Thomson Reuters consensus; sees FY11 revs +4-8% to ~$110.83-115.10 bln vs. $110.2 bln Thomson Reuters consensus. Wireless: 6.3 percent YoY increase in service revenues in 1Q 2011; data revenues up 22.3 percent; 25.8 percent operating income margin and 43.7 percent Segment EBITDA margin on service revenues (non-GAAP). 1.8 mln net additions, excluding acquisitions and adjustments, includes 906,000 retail postpaid net customer additions; continued low retail postpaid churn of 1.01 percent. 104.0 mln total connections, includes 88.4 mln retail customers. Cash flow from operations totaled $5.0 bln in Q1, down from $7.1 bln in first-quarter 2010. Operating cash flow from higher net income in first-quarter 2011 was offset by the launch of the iPhone and satisfaction of Verizon's full-year 2011 pension funding obligation of $392 mln. In addition, the first half of last year included cash flows from since-divested properties. ~77 percent of first-quarter 2011 revenues were generated by higher-growth wireless, FiOS and strategic enterprise services, compared with ~72 percent of comparable first-quarter 2010 revenues. Verizon continues to expect 2011 capital spending to be essentially flat, compared with the 2010 investment of $16.5 bln. In first-quarter 2011, Verizon's capital expenditures totaled $4.4 bln, compared with $3.4 bln in first-quarter 2010, as the co aggressively invested in growth opportunities, including the deployment of Verizon's nationwide 4G LTE
7:04AM Celestica to acquire Brooks Automation's (BRKS) semiconductor equipment contract manufacturing operations for ~$80 mln (CLS) 10.58 : Co announces the acquisition of Brooks Automation's (BRKS) semiconductor equipment contract manufacturing operations. The purchase price is expected to be ~$80 mln and will be financed from either the co's credit facility or from cash on hand. The business generated revenue of ~$135 mln for the six months ended March 31, 2011.
7:03AM Entegris beats by $0.03, beats on revs; guides Q2 EPS above consensus, revs above consensus (ENTG) 8.25 +0.40 : Reports Q1 (Mar) earnings of $0.23 per share, $0.03 better than the Thomson Reuters consensus of $0.20; revenues rose 26.5% year/year to $203.1 mln vs the $187.9 mln consensus. Co issues upside guidance for Q2, sees EPS of $0.22-0.25 vs. $0.22 Thomson Reuters consensus; sees Q2 revs of $200-210 mln vs. $192.91 mln Thomson Reuters consensus.
6:41AM General Electric beats by $0.03, beats on revs; raises divdend 7% (GE) 20.40 : Reports Q1 (Mar) GAAP earnings from continuing operations of $0.31 per share, $0.03 better than the Thomson Reuters consensus of $0.28; revenues rose 6.2% year/year to $38.45 bln vs the $34.64 bln consensus. GE Capital Services' (GECS) revs increased 3% from last year to $13.2 bln. Industrial sales of $22.1 bln decreased 6% versus 2010. Segment profit increased 36% compared with the first quarter of 2010, as increases of more than 200% at GE Capital, 37% at Transportation, 7% at Healthcare and 5% at Aviation more than offset a 7% earnings decline at Energy Infrastructure. "GE Healthcare, Transportation and Aviation delivered strong results. Strategic investments in high-growth segments have strengthened the co's Energy portfolio and position that business to return to growth in the second half of this year. We ended the quarter with a record high backlog of $177 billion... Reserve coverage decreased slightly in the quarter, driven by improving portfolio quality. Since the first quarter of 2010, we've improved our GECC Tier 1 common ratio to 9.8% from 7.8% and reduced GECC leverage to 4.5:1 from 5.5:1." GE raised its quarterly dividend by $0.01 to $0.15 effective in the third quarter of 2011. This is the third dividend increase declared in the last 12 months and reflects GE leadership's confidence in the company's business performance.
6:23AM Nokia and Microsoft sign definitive agreement ahead of schedule (NOK) 8.59 : Nokia (NOK) and Microsoft (MSFT) announce the signing of a definitive agreement on a partnership that will result in a new global mobile ecosystem, utilizing the very complementary assets of both companies. Completed ahead of schedule, the definitive agreement is consistent with the joint announcement made on February 11. In addition to agreeing to the terms of their partnership, including joint contributions to the development of the new ecosystem, Nokia and Microsoft also announced significant progress on the development of the first Nokia products incorporating Windows Phone. Nokia has also started porting key applications and services to operate on Windows Phone and joint outreach has begun to third party application developers. Nokia will deliver mapping, navigation, and certain location-based services to the Windows Phone ecosystem. Nokia will build innovation on top of the Windows Phone platform in areas such as imaging, while contributing expertise on hardware design and language support, and helping to drive the development of the Windows Phone platform. Microsoft will provide Bing search services across the Nokia device portfolio as well as contributing strength in productivity, advertising, gaming, social media and a variety of other services. Joint developer outreach and application sourcing, Microsoft will receive a running royalty from Nokia for the Windows Phone platform, starting when the first Nokia products incorporating Windows Phone ship. The royalty payments are competitive and reflect the large volumes that Nokia expects to ship, as well as a variety of other considerations related to engineering work to which both companies are committed. Microsoft delivering the Windows Phone platform to Nokia will enable Nokia to significantly reduce operating expenses.
# SanDisk (SNDK) announced a 64-gigabit, 2-bits-per-cell based monolithic chip made on 19-nanometer technology, which co states is "the most advanced memory process technology node in the world."
# Intel (INTC) and Micron Technology (MU) expanded their NAND Flash memory joint venture operations with the official opening of IM Flash Singapore. The $3 bln facility is expected to employ about 1,200 and is currently ramping production of the cos' industry-leading 25 nanometer NAND Flash memory.
NXP Semiconductors (NXPI) announced an addition to its broad GreenChip SSL family of products, the GreenChip SSL4101T controller IC, which offers new levels of professional-grade performance for Solid State LED lighting power supplies.
09:48 am AAPL Guides Q3 Below Consensus (AAPL)
Apple (AAPL $352.34 +9.93) reported second quarter earnings of $6.40 per share, $1.03 better than the Thomson Reuters consensus of $5.37.
Revenues rose 82.7% year-over-year to $24.67 billion versus the $23.38 billion consensus.
For the third quarter, the company expects to see earnings of approx. $5.03 versus the $5.25 Thomson Reuters consensus. On the top line, the company expects to see revenue of approx. $23 billion versus the $23.83 billion Thomson Reuters consensus.
The company reported second quarter gross margins of 41.4% well above expectations and the company's guidance.
The company reported 3.76 million Macs sold in second quarter, better than expectations, 18.65 million iPhones sold, better than expectations, and 4.69 iPads sold, better than expectations.
The company said, "With quarterly revenue growth of 83 percent and profit growth of 95 percent, we're firing on all cylinders," said Steve Jobs, Apple's CEO. "We will continue to innovate on all fronts throughout the remainder of the year." (Briefing.com note: AAPL typically provides conservative guidance on its earnings releases)
09:41 am GE Tops Q1 Expectations; Raises Dividend (GE)
General Electric (GE $20.33 -0.07) reported first quarter GAAP earnings from continuing operations of $0.31 per share, $0.03 better than the Thomson Reuters consensus of $0.28.
Revenues rose 6.2% year-over-year to $38.45 billion versus the $34.64 billion consensus.
GE Capital Services' (GECS) revs increased 3% from last year to $13.2 billion. Industrial sales of $22.1 bln decreased 6% versus 2010. Segment profit increased 36% compared with the first quarter of 2010, as increases of more than 200% at GE Capital, 37% at Transportation, 7% at Healthcare and 5% at Aviation more than offset a 7% earnings decline at Energy Infrastructure.
The company said, "GE Healthcare, Transportation and Aviation delivered strong results. Strategic investments in high-growth segments have strengthened the co's Energy portfolio and position that business to return to growth in the second half of this year. We ended the quarter with a record high backlog of $177 billion... Reserve coverage decreased slightly in the quarter, driven by improving portfolio quality. Since the first quarter of 2010, we've improved our GECC Tier 1 common ratio to 9.8% from 7.8% and reduced GECC leverage to 4.5:1 from 5.5:1."
GE raised its quarterly dividend by $0.01 to $0.15 effective in the third quarter of 2011. This is the third dividend increase declared in the last 12 months and reflects GE leadership's confidence in the company's business performance.
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