From Briefing.com: 4:15 pm : Stocks began the day with a bullish sentiment as the three major averages spent the first 90 minutes on a steady upward climb. After reaching session highs, the S&P 500 leveled off and held its gains into the afternoon before ending with a gain of 1.1%.
The technology sector was one of the top performers, and the SPDR Technology Select Sector ETF (XLK 29.34, +0.46) settled higher by 1.6%. However, the biggest tech component, Apple (AAPL 596.53, +1.21), underperformed with a gain of just 0.2%.
In notable tech earnings, Visa (V 143.88, +5.12) advanced 3.7% after beating on the top and bottom lines. The payment processor earned $1.54, which was $0.04 better than the Capital IQ consensus estimate. Visa's revenue of $2.73 billion represents a 14.6% year-over-year increase, and was reported ahead of expectations. In addition, the company announced a new $1.5 billion repurchase program.
Elsewhere, JDA Software (JDAS 44.76, +6.61) surged 17.3% after announcing plans to merge with RedPrairie. Per the agreement, JDA stockholders will receive $45 per share, which represents a 33.0% premium to JDA's closing price on October 26. This was the day before speculation regarding a sale started circulating. In addition, JDA reported third quarter earnings of $0.53 on $164.5 million in revenue. The earnings may not be comparable to the Capital IQ analyst estimate of $0.54, while the company's revenue fell short of expectations.
In other M&A news, auto parts manufacturer, Williams Controls (WMCO 15.36, +4.45), soared 40.8% after agreeing to be acquired by Curtis-Wright (CW 31.50, +0.63). Per the agreement, Williams Controls stockholders will receive $15.42 per share, which represents a 41.3% premium to WMCO's Wednesday closing price.
Also of note, Advance Auto Parts (AAP 81.00, +10.06) spiked 14.2% after CNBC reported the company has hired Blackstone to explore a sale. The total price tag may be over $6 billion, which would equate to about $82 per share. Peers Autozone (AZO 380.34, +5.34), O'Reilly Automotive (ORLY 88.05, +2.20), and Pep Boys (PBY 10.47, +0.48) all moved higher on the news.
As the new month begins, retailers are reporting their October same store sales. Out of the eighteen companies which already reported, twelve beat consensus estimates while six missed. However, half of the names which missed reported upside third quarter guidance.
Among the names which exceeded expectations, Bon-Ton Stores (BONT 13.49, +1.23) led the group higher with a gain of 10.0%. Meanwhile, Costco (COST 97.13, -1.30) and Stein Mart (SMRT 7.52, -0.34) saw respective losses of 1.3% and 4.3% despite reporting sales ahead of expectations.
On the downside, Zumies (ZUMZ 21.13, -4.19) slid 16.6% after reporting a 0.6% increase in same store sales. The reading was a disappointment as the Retail Metrics consensus expected the company to post a 4.4% increase. The company pointed to Europe as the reason for anemic growth, and issued downside guidance. Following the news, Piper Jaffray downgraded the stock to ‘underweight' from ‘neutral.'
Looking at automakers which reported their sales, Ford Motor (F 11.25, +0.09) gained 0.8% after reporting October sales of 168,456 vehicles. The figure represents a 0.4% year-over-year growth.
Toyota Motor (TM 78.05, +0.58) added 0.8% after reporting monthly sales of 155,242, which is a 15.8% increase on a daily selling rate basis and on an unadjusted raw volume basis. Also of note, a story out of Reuters indicated the company's October sales in China fell by 44.0%.
Honda Motor (HMC 30.35, +0.19) advanced 0.6% after its October sales increased by 8.8% year-over-year, to 106,973 units.
A number of economic data points came through today and most figures were largely in-line with expectations. The October Challenger Job Cuts report showed a 12.0% year-over-year increase. This follows the prior reading which indicated a 70.8% decline.
According to today's ADP National Employment Report, employment in the nonfarm private business sector rose by 158K in October. This was above the 143K increase expected by Briefing.com consensus.
The latest weekly initial jobless claims count totaled 363,000, which was lower than the 375,000 that had been expected by the Briefing.com consensus. The tally was below the revised prior week count of 372,000. As for continuing claims, they rose to 3.263 million from 3.254 million.
The consumer confidence reading for October came in at 72.2 while economists polled by Briefing.com expected a reading of 72.0. This follows prior month's 70.3 print.
The October ISM Index came in better-than-expected at 51.7 versus the 51.0 Briefing.com consensus, and up from September's reading of 51.5. Meanwhile, September construction spending rose by 0.6% month-over-month, against the expected increase of 0.8%.
Lastly, third quarter unit labor costs decreased by 0.1% which was lower than the 1.4% rise that had been widely anticipated. During the same period, productivity increased by 1.9%, according to the preliminary reading. An increase of 1.6% had been broadly forecast.
Tomorrow's economic data will focus on jobs as October nonfarm payrolls, nonfarm private payrolls, the unemployment rate, hourly earnings, and average workweek will all be announced at 8:30 ET. In addition, September factory orders will be reported at 10:00 ET.DJ30 +136.16 NASDAQ +42.83 SP500 +15.43 NASDAQ Adv/Vol/Dec 1611/1.81 bln/855 NYSE Adv/Vol/Dec 2343/797.5 mln/705
3:30 pm : A rebound by the dollar index following encouraging ADP and Initial Claims numbers put pressure on precious metals during today's pit trade. Both gold and silver retreated from their respective session highs of $1726.00 per ounce and $32.63 per ounce set in early morning action and trended lower for most of their sessions.
Gold eventually slipped into negative territory and settled 0.2% lower at $1715.50 per ounce. Silver also broke below the breakeven level and closed with a 0.2% loss at $32.26 per ounce.
Crude oil popped to its pit session high of $87.42 per barrel following bullish inventory data that showed a draw of 2.05 mln barrels when a build of 1.8 mln barrels was anticipated. The energy component then traded in a consolidative pattern just below that level despite a rebound by the dollar index. Crude eventually closed with a 1.0% gain at $87.06 per barrel.
Natural gas dipped to a floor session low of $3.65 per MMBtu moments after inventory data showed a build of 65 bcf when a build of 67 bcf was widely expected. It chopped around between positive and negative territory for the remainder of pit trade and settled at $3.70 per MMBtu, or 0.3% higher.DJ30 +117.46 NASDAQ +40.79 SP500 +14.03 NASDAQ Adv/Vol/Dec 1530/1462.5 mln/899 NYSE Adv/Vol/Dec 2293/498 mln/736
4:59PM AXT reports EPS in-line, misses on revs (AXTI) 3.20 : Reports Q3 (Sep) earnings of GAAP $0.03 per share, in-line with the Capital IQ Consensus Estimate consensus of $0.03; revenues fell 26.5% year/year to $20.8 mln vs the $22.08 mln consensus.
Gross margin was 26.3 percent of revenue for the third quarter of 2012.
"The compound semiconductor substrate market is currently experiencing a correction, largely driven by weaker demand and a moderate amount of excess inventory in the channel. However, our solid execution over the last many quarters is allowing us to weather the current down cycle and we are using this time to support significant qualifications that are still ongoing and to focus our resources on strategic geographies and applications that are likely to benefit AXT in the future. We view improving market conditions, new customer qualifications and a bottoming of raw material pricing as key catalysts for our growth in the coming year and beyond."
4:59PM Intl Rectifier beats by $0.05, beats on revs; guides Q2 revs below consensus (IRF) 16.04 +0.55 : Reports Q1 (Sep) loss of $0.20 per share, $0.05 better than the Capital IQ Consensus Estimate of ($0.25); revenues fell 16.6% year/year to $252.49 mln vs the $242.38 mln consensus. Non-GAAP gross margin for the first quarter was 28.3% compared with non-GAAP gross margin of 27.5% in the prior quarter and non-GAAP gross margin of 37.9% in the prior year quarter.
Co issues downside guidance for Q2, sees Q2 revs of $215-230 mln vs. $245.99 mln Capital IQ Consensus Estimate. "Given the continued weak demand in our end markets and macroeconomic uncertainty, we have initiated additional measures to reduce our SG&A and R&D expenses. We expect these actions will further reduce our quarterly SG&A and R&D expenses to $75 million by the June quarter of 2013. When compared to the run rate exiting our 2012 fiscal year, we now expect to save approximately $40 million in SG&A and R&D expenses on an annualized basis when our actions are completed...We remain optimistic about our medium-term growth prospects and expect that our operational restructuring activities will help IR's return to profitability and increase future operating leverage"
4:52PM Integrated Silicon beats by $0.02, beats on revs; guides Q1 EPS in-line, revs above consensus (ISSI) 8.84 +0.29 : Reports Q4 (Sep) earnings of $0.24 per share, excluding non-recurring items, $0.02 better than the Capital IQ Consensus Estimate of $0.22; revenues rose 1.7% year/year to $72.5 mln vs the $68.53 mln consensus. Co issues guidance for Q1, sees EPS of $0.20-0.24 vs. $0.24 Capital IQ Consensus Estimate; sees Q1 revs of $75-81 mln vs. $72.22 mln Capital IQ Consensus Estimate.
4:33PM Skyworks beats by $0.01, reports revs in-line; guides Q1 EPS below consensus, revs in-line (SWKS) 24.07 +0.69 : Reports Q4 (Sep) earnings of $0.53 per share, $0.01 better than the Capital IQ Consensus Estimate of $0.52; revenues rose 4.7% year/year to $421.1 mln vs the $420.48 mln consensus. Co issues guidance for Q1, sees EPS of $0.54, excluding non-recurring items, vs. $0.57 Capital IQ Consensus Estimate; sees Q1 revs of ~$450 mln vs. $450.50 mln Capital IQ Consensus Estimate.
Expands Operating Margin 100 Basis Points Sequentially to 24.6 Percent on a Non-GAAP Basis.
Commentary: "Interrelated macro trends such as social networking, cloud-based content and the explosion of audio and video streaming are driving increased semiconductor content and complexity in smartphones, tablets, ultrabooks and e-readers as well as within the supporting network infrastructure. At the same time, wireless and power management functionality is rapidly proliferating across adjacent applications spanning machine-to-machine, automotive, broadband, home automation, smart grid and medical markets. Given our differentiated product portfolio, engagements with all key OEMs and scale, Skyworks is well positioned to continue to gain market share, capture additional content per platform and, as a result, significantly outperform our addressed markets throughout fiscal 2013."
4:29PM ON Semiconductor misses by $0.01, misses on revs; guides Q4 revs below consensus (ONNN) 6.27 -0.12 : Reports Q3 (Sep) earnings of $0.12 per share, excluding non-recurring items, $0.01 worse than the Capital IQ Consensus Estimate of $0.13; revenues fell 19.2% year/year to $725.5 mln vs the $743.22 mln consensus. Co issues downside guidance for Q4, sees Q4 revs of $650-690 mln vs. $742.39 mln Capital IQ Consensus Estimate.
4:26PM Atmel beats by $0.01, misses on revs (ATML) 5.07 +0.41 : Reports Q3 (Sep) earnings of $0.10 per share, $0.01 better than the Capital IQ Consensus Estimate of $0.09; revenues fell 24.7% year/year to $361 mln vs the $367.09 mln consensus.
* Non-GAAP gross margin was 43.7% in the third quarter of 2012 compared to 44.6% in the immediately preceding quarter and 50.4% in the third quarter of 2011.
4:20PM TTM Tech beats by $0.03, misses on revs; guides Q4 EPS below consensus, revs in-line (TTMI) 9.30 +0.30 : Reports Q3 (Sep) earnings of $0.22 per share, excluding non-recurring items, $0.03 better than the Capital IQ Consensus Estimate of $0.19; revenues fell 5.4% year/year to $339 mln vs the $346.59 mln consensus. Co issues downside EPS guidance for Q4, sees EPS of $0.14-0.21, excluding non-recurring items, vs. $0.24 Capital IQ Consensus Estimate; sees Q4 revs of $360-380 mln vs. $365.93 mln Capital IQ Consensus Estimate.
4:17PM FormFactor beats by $0.10, beats on revs (FORM) 4.75 +0.19 : Reports Q3 (Sep) loss of $0.15 per share, excluding non-recurring items, $0.10 better than the Capital IQ Consensus Estimate of ($0.25); revenues fell 20.7% year/year to $41.3 mln vs the $40.04 mln consensus. "We saw softening demand in Q3 in the personal computer and mobile device markets, which negatively impacted our business. We continued our focus on operational efficiencies during Q3, and also undertook a transformational strategic step through our acquisition of Micro-Probe, which closed on October 16th."
4:12PM MagnaChip Semi beats by $0.20, reports revs in-line; guides Q4 revs in-line (MX) 12.10 +0.95 : Reports Q3 (Sep) earnings of $0.81 per share, excluding non-recurring items, $0.20 better than the Capital IQ Consensus Estimate of $0.61; revenues rose 10.7% year/year to $221.9 mln vs the $221.29 mln consensus. Co issues in-line guidance for Q4, sees Q4 revs of $213-222 mln vs. $220.15 mln Capital IQ Consensus Estimate.
4:11PM Tessera Tech beats by $0.10, beats on revs (TSRA) 14.29 +0.12 : Reports Q3 (Sep) earnings of $0.12 per share, excluding non-recurring items, $0.10 better than the Capital IQ Consensus Estimate of $0.02; revenues rose 22.6% year/year to $72.7 mln vs the $67.75 mln consensus.
4:10PM Monolithic Power beats by $0.01, misses on revs; guides Q4 revs below consensus (MPWR) 19.84 +0.41 : Reports Q3 (Sep) earnings of $0.27 per share, excluding non-recurring items, $0.01 better than the Capital IQ Consensus Estimate of $0.26; revenues rose 6.6% year/year to $56.5 mln vs the $58.01 mln consensus. Co issues downside guidance for Q4, sees Q4 revs of $46-50 mln vs. $55.81 mln Capital IQ Consensus Estimate.
4:07PM First Solar beats by $0.20, misses on revs; raises low end of FY12 EPS guidance, lowers revenue outlook (FSLR) 24.74 +0.44 : Reports Q3 (Sep) earnings of $1.27 per share, excluding non-recurring items, $0.20 better than the Capital IQ Consensus Estimate of $1.07; revenues fell 16.6% year/year to $839 mln vs the $976.14 mln consensus. The decrease in net sales from the second quarter of 2012 was primarily due to project-specific decreases including Silver State North, which was completed in the second quarter, and reduced construction activity at Agua Caliente, consistent with the Company's planned construction schedule.
Co issues in-line guidance for FY12, sees EPS of $4.40-4.70, excluding non-recurring items (Prior guidance $4.20-4.70), vs. $4.42 Capital IQ Consensus Estimate; sees FY12 revs of $3.5-3.8 bln (Prior $3.6-3.9 bln) vs. $3.72 bln Capital IQ Consensus Estimate.
12:07PM Semiconductor Hldrs ETF extends aggressive advance to its 50 sma (SMH) 31.96 +0.87 : Have noted continued relative strength in the sector this morning with the latest push bringing its 50 day sma into play at 31.96 (session high 31.96). Short term resistance above is at 32.09/32.16 (congest, early Sep low/breakdown point, 50% retrace of Aug-Oct decline) -- ADI +2.8%, ALTR +3.6%, AMAT +2.2%, INTC +3.3%, KLAC +4%, LLTC +3.4%, MU +5.2%, MXIM +2.7%, SNDK +5.3%, TER +4.2%, TXN +3.3%, XLNX +2.4%.
CalAmp (CAMP) has been awarded a $1.1 mln contract to supply the City of Buffalo, NY Emergency Services Department with a 700/800 MHz private mobile data network.
TranSwitch (TXCC) announced that its HDplay TXC-44146 transceiver has been designed into Playvision's high definition video switch targeted for production launch in Dec 2012.
Atmel (ATML) announced its maXTouch mXT224S controller is powering the touchscreen in the recently launched Samsung (SSNLF) Galaxy S III 'Mini' smartphone.
6:12AM Research In Motion confirmed passing a critical milestone in development of new mobile computing platform, BlackBerry 10 - enters carrier lab testing (RIMM) 7.93 : In the last week, BlackBerry 10 achieved Lab Entry with more than 50 carriers -- a key step in our preparedness for the launch of BlackBerry 10 in the first quarter of 2013. This process will continue in the coming months as more carriers around the world formally evaluate the devices and the brand new software.
Cirrus Logic (CRUS $40.50 -0.28) reported second quarter earnings of $0.79 per share, excluding non-recurring items, $0.08 better than the Capital IQ consensus of $0.71, while revenues rose 90.7% year/year to $193.8 million versus the $180.69 million consensus. The company issued upside guidance for the third quarter sees Q3 revenues of $270-300 million versus the $233.84 million consensus, GM 50-52%.
09:10 am Cirrus Logic downgraded to Hold at Feltl & Co.; tgt $44: . Feltl & Co. downgrades CRUS to Hold from Strong Buy and sets target price at $44. The firm has become less focused on growth metrics as we believe potential headwinds to future growth emerged during yesterday's earnings. CRUS has historically reported mid-50s GM levels. In the firm's opinion a reduction in future GM levels to low-50s suggests potential longer-term issues than temporary concerns highlighted regarding difficulties in customer product ramp. While they believe CRUS remains innovative and likely offers future growth opportunities, they believe the potential for multiple headwinds to negatively impact future growth have likely increased.
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