Monthly Archives: April 2013
Tax Benefits Help $AMGN Post a 21% Rise in Profits, Revs Miss
“WASHINGTON (AP) — Tax benefits helped biotech giant Amgen Inc.’s first-quarter earnings beat Wall Street’s prediction, despite disappointing drug sales.
The company said Tuesday that net income rose 21 percent to $1.43 billion, or $1.88 per share, from $1.18 billion, or $1.48 per share, in the prior-year period. It got a boost from $13 million in federal and state tax benefits in the most recent quarter.
Adjusting for one-time expenses the company would have earned $1.96 per share, better than the $1.84 average estimate of analysts polled by FactSet.
Revenue rose 5 percent, to $4.24 billion, missing analysts’ estimate of $4.37 billion. Operating expenses rose 9 percent, to $2.67 billion.
Shares fell $7.01, or 6.2 percent, to $105.75 in after-hours trading.
Overall drug sales rose 6 percent, driven by growth of Enbrel for psoriasis and rheumatoid arthritis and Prolia for osteoporosis. But those gains were partially offset by the continued slide of anemia drugs Aranesp and Epogen, which have faced limits on dosing and insurance payments due to safety concerns. Aranesp sales fell 10 percent to $168 million, while Epogen declined 2 percent to $435 million.
Despite continuing declines for anemia drugs, those products could get a boost in coming months after a major setback for a rival product….”
Comments »Despite Subscriber Growth $T Posts a Miss in Revenues
“Competition is undeniably tight in the wireless-carrier market, especially between market leadersAT&T (NYSE:T) and Verizon (NYSE:VZ), which together hold almost a duopoly.
While Verizon did not report as many smartphone activations as it did in the previous quarter, AT&T’sfirst-quarter results, reported after the market closed Tuesday, showed that the carrier amassed 1.2 million new smartphone subscribers, a figure that contributed to the company’s best-ever first quarter in terms of smartphone sales. Now, more than 72 percent, or approximately 48.3 million, of all the company’s on-contract customers own smartphones. Additionally, AT&T added 296,000 new postpaid customers during the quarter.
For technology
companies and wireless carriers alike, smartphones — along with their related accessories and services — are the most profitable business sectors. In evidence of this, AT&T’s gains in smartphone sales and contracts pushed its wireless revenue to $16.7 billion, an increase of 4 percent from the year-ago quarter.
In comparison, AT&T’s primary rival, Verizon, reported last week that it had added 677,000 new subscribers during the last quarter and sold 7.2 million smartphones…”
Comments »Market Melt Up Update
U.S. equities took their cue from Europe and ignored bad global economic data. Flash PMIs for China and the U.S. were below expectations while Europe continues to climb deeper into a pitfall of recession.
Companies around the globe reported good earnings which seem to help equities rally.
Oil has pared half or more of its morning losses while gold and silver have pared gains to find red ink.
The markets have overlooked last weeks drudging and have found a suit of Teflon to replace last week’s burlap.
Given yesterday’s and today’s trading action the bulls are claiming that the bull leg is still intact and that new highs will be had soon.
[youtube://http://www.youtube.com/watch?v=W4VpE-0zitU 450 300] Comments »
Spin Doctor Economics Will Help U.S Growth to Hit 3%
“The U.S. economy will grow 3 percent larger in July because the government is tweaking certain statistics that add billions of dollars in intangible assets to the gross domestic product (GDP), according to the Financial Times.
The revisions are aimed at more accurate tracking of changes in U.S. output and include the addition of factors such as spending on research and development (R&D), the impact of creative works such as movies and music and defined pension benefit schemes.
“We are carrying these major changes all the way back in time — which for us means to 1929 — so we are essentially rewriting economic history,” Brent Moulton, manager of national accounts at the Bureau of Economic Analysis (BEA), told the Times….”
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$GS Covers Au Short Position
$TRV Sees Higher Profits on Lower Claims and Higher Rates
“Travelers posted a higher first-quarter profit, helped by a decline in natural disaster losses and rising insurance rates.
After the earnings announcement, the company’s shares rose in pre-market trading. (Click here to get the latest quotes for Travelers.)
The company posted first-quarter earnings excluding items of $2.33 per share, up from $2.01 a share in the year-earlier period.
Revenue increased to $5.597 billion from $5.50 billion a year ago….”
Comments »U.S. Home Prices Rise in Line With Expectations
“The FHFA’s reading of U.S. home prices for February is out.
The headline index climbed by 0.7% month-over-month, which was right in line with expectations.
This is up from 0.6% a month ago.
“The U.S. index is 13.6 percent below its April 2007 peak…”
Comments »U.S. Flash PMI Falls More Than Expected
“April Flash PMI is out.
The headline index fell to 52.0 from last month’s 54.9 reading.
Economists were looking for a smaller decrease to 53.9.
Any number over 50 indicates expansion, so this reading says American manufacturing is still expanding, but at a slower pace than last month.
Below is a full breakdown of the sub-components of the index: …”
Comments »Upgrades and Downgrades This Morning
Upgrades – MT, SAN, BAC, CATT, CON, GE, INFA, KMB, MBI, MS, VECO,
Downgrades – RATE, C, CMP, MSFT, RCI, SLM, WU, YUM,
Comments »Gapping Up and Down This Morning
In Play and On the Wires
Trustee Sues Corzine Over MF Global Collapse
“The trustee overseeing MF Global Holdings Ltd.’s bankruptcy sued former Chief Executive Jon S. Corzine and two other executives for their role in the brokerage’s collapse.
Trustee Louis J. Freeh on Monday filed a lawsuit in bankruptcy court against Mr. Corzine, the former governor of New Jersey, and former Chief Operating Officer Bradley I. Abelow and former Chief Financial Officer Henri J. Steenkamp….”
Comments »$DAL Beats Expectations, Profits Fall With Fewer Hedging Gains
“Delta Air Lines Inc.’s DAL -0.79% first-quarter net profit fell 94% as the carrier posted fewer fuel-hedging gains, offsetting modest revenue growth.
Adjusted earnings topped expectations, however.
Delta recently was one of the first companies to cite the so-called sequester U.S. budget cuts that came into force last month as it saw revenue growth slow in March. The company also blamed reduced government spending for lower late flight bookings, which typically attract higher fares—while signaling that demand also was hurt by efforts to raise fares….”
Comments »$X Beats Expectations
“(Reuters) – Xerox Corp on Tuesday reported first-quarter earnings that beat expectations but said second-quarter profit would miss estimates as it restructures to become a broader technology company.
Adjusted earnings were 27 cents per share, compared with the average analyst estimate of 24 cents. Revenue fell 3 percent to $5.4 billion, below analyst expectations of $5.5 billion.
Xerox said earnings were higher than expected due to a benefit of 2 cents after reducing its reserve for recent litigation. It did not elaborate.
For the second quarter, Xerox, which has its roots in copiers and printers and now focuses on services like managing toll systems and healthcare programs, forecast earnings, excluding items, in the range of 23 cents to 25 cents per share. Wall Street is looking for 26 cents per share, according to Thomson Reuters I/B/E/S…”
Drought Helps $DD to Double Profits
“(Reuters) – Chemicals maker DuPont’s quarterly profit more than doubled as the worst dry spell in decades encouraged U.S. farmers to buy its drought-hardy seeds and crop-protection products to boost yields.
Strong wheat, corn and soybean prices also spurred agricultural sales in the Americas, helping DuPont beat estimates for the quarter despite an ongoing decline in demand for its once-lucrativetitanium dioxide paint pigment.
The Wilmington, Delaware-based company’s shares traded up 0.7 percent at $50.74 before the bell on Tuesday.
“The first quarter finished as expected, with the strong agriculture performance and performance chemicals’ decline from peak levels last year,” DuPont Chief Executive Ellen Kullman said in a statement.
The 210-year-old company, known for its chemicals business, is focusing on food and agriculture products that are less exposed to ebbs and flows in titanium dioxide (Ti02) sales.
The shift is evident in the $5 billion sale of its car paint unit last year and the $6 billion purchase of nutritional supplements maker Danisco in 2011.
“Ti02 has declined and it’s a much smaller factor now. We also think it is bottoming so it’s become less of an issue,” John Roberts, who leads U.S. chemical coverage at UBS Investment Research, said ahead of the announcement.
He had expected first-quarter earnings of $1.55 per share, above the Wall Street estimates of $1.52 per share. Excluding one-time items, DuPont earned $1.56 per share….”
Comments »$ARM Beats Expectations With Revenues Jumping 29%
“ARM Holdings Plc (ARM), whose chip designs power Apple Inc. (AAPL)’s iPhone and iPad, reported higher sales that beat analysts’ estimates as demand increased for its graphics and processing technology. The stock jumped.
Revenue rose 29 percent to 170.3 million pounds ($260 million) in the first quarter ended in March, the Cambridge, England-based company said today. Analysts predicted 160 million pounds, the average of estimates compiled by Bloomberg.
ARM Chief Executive Officer Warren East said in March he would retire July 1 after almost 12 years in charge. His successor, Simon Segars, will focus on increasing the company’s share of semiconductor designs and moving ARM’s technology into connected devices, Web-enabled “smart” televisions, tablets and smartphones. ARM’s chip designs compete with patents from semiconductor makers such as Intel Corp. (INTC)
“We’ve made an encouraging start to 2013 with more leading companies deploying our technology in their products,” ARM Chief Financial Officer Tim Score said on a conference call.
ARM’s revenue increase this year will be “quite well ahead of” the industry’s projected growth in the “mid-single digits,” Score said. That means ARM’s sales will be at least in line with market expectations, he said.
ARM rose as much as 8.8 percent to 945.5 pence, the biggest intraday gain since July, and advanced 7.3 percent to 932.5 pence at 8:30 a.m. in London. The stock had risen 53 percent in the 12 months through yesterday.
Connected Appliances…”
Comments »$STM Guides Higher on Chip Demand for the Second Half of 2013
“STMicroelectronics NV (STM), Intel Corp. (INTC)’s biggest competitor in Europe, forecast new products and chip demand will boost sales in the second half as it winds down a wireless venture with Ericsson AB that has contributed to six consecutive quarterly losses.
Europe’s biggest chipmaker predicted second-quarter sales growth of about 7 percent, excluding the wireless business. The projection “seems to be ahead of analog peers and implies share gains,” Bank of America Merrill Lynch analysts led by Didier Scemama wrote in a note to clients….”
Comments »The Euro Falls on Lower Manufacturing Data
“The euro fell to a two-week low against the dollar as a report showed services and manufacturing output in the region shrank for a 15th month, adding to signs the recession is worsening.
The single currency weakened against 13 of its 16 major counterparts as the data added to speculation the European Central Bank will cut interest rates to spur growth. The yen and the dollar strengthened after an industry report showed Chinese manufacturing expanded at a slower pace, increasing demand for safer assets. Sweden’s krona dropped to a four-month low against the U.S. currency after the nation’s unemployment rate unexpectedly increased in March.
“The overall picture is pretty bleak,” said Lutz Karpowitz, a senior currency strategist at Commerzbank AG in Frankfurt. “The likelihood of the ECB cutting interest rates increased today. All in all, it’s negative for the euro.”
The euro declined 0.6 percent to $1.2985 at 10:02 a.m. London time after sliding to $1.2974, the weakest level since April 8. The 17-nation currency dropped 1.2 percent to 128.16 yen. Japan’s currency gained 0.5 percent to 98.69 per dollar….”
Comments »Bond Yields and Rate Cut Expectations Rise as Economic Data Worsens for Europe
“Italian bonds advanced, pushing two-year note yields to a record low, as data showing euro-area output contracted for a 15th month in April boosted speculation the European Central Bank will lower interest rates.
The yield on Italian 10-year government bonds fell below 4 percent for the first time in almost 2 1/2 years, while Spanish and Portuguese yields dropped to the least since 2010. Borrowing costs in France and Ireland declined to the lowest on record as a purchasing managers’ index showed services in Germany unexpectedly shrank with manufacturing. Bunds rose for a second day, with yields falling to the lowest since July, and Treasuries and U.K. gilts also advanced.
“The weaker tone in the headline and German PMIs this morning has fueled rate-cut speculation with regard to the next meeting,” Michael Leister, an interest-rate strategist at Commerzbank AG in London. “Bonds are rallying across the board, bunds as well as peripherals, which clearly shows to us that this hunt for yield is really intensifying and the market is expecting an ultra-low yield environment to stay in place for the foreseeable future.”
Italy’s two-year yield fell six basis points, or 0.06 percentage point, to 1.17 percent at 12:14 p.m. London time, after reaching 1.16 percent, the lowest level since Bloomberg began compiling the data in 1993. The 6 percent security due November 2014 rose 0.09, or 90 euro cents per 1,000-euro ($1,230) face amount, to 107.41.
The nation’s 10-year yield declined as much as eight basis points to 3.975 percent, the lowestsince Nov. 8, 2010.
