“SAP AG (SAP), the biggest maker of business-management software, forecast at least a 12 percent gain in full-year earnings as it adds Internet-based programs to attract users and fend off competition from Oracle Corp.

Operating profit adjusted for some items will rise to 5.85 billion euros ($7.79 billion) to 5.95 billion euros from 5.21 billion euros in 2012, assuming unchanged exchange rates, SAP said today. Analysts project 6.11 billion euros, the average of estimates compiled by Bloomberg.

While the forecast trailed estimates, it helped quell concerns that SAP’s pace of growth may be petering out. Co-Chief Executive Officers Jim Hagemann Snabe and Bill McDermotthave added mobile and Web-based programs as well as the fast Hana database to compete with Oracle and persuade companies to spend even as economies such as that of the euro area shrink.

“I certainly wouldn’t consider that a low-key guidance, it’s double-digit growth and it’s significant,” McDermott said in an interview at the company’s headquarters in Walldorf, Germany. “Our cloud business is growing fantastically, as is Hana and mobile, and this emanates from a consistent core, so we’re really bullish.”

SAP shares rose 2.7 percent to 59.40 euros as of 10:43 a.m. inFrankfurt, valuing the company at 73 billion euros. The stock rallied 50 percent last year, making it the fourth-best performer in Germany’s 30-member benchmark DAX Index and exceeding Oracle (ORCL)’s 30 percent gain….”

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“Fourth-Quarter 2012:

• Diluted EPS:
  • GAAP: $5.13, up 11 percent;
  • Operating (non-GAAP): $5.39, up 14 percent;
• Net income:
  • GAAP: $5.8 billion, up 6 percent;
  • Operating (non-GAAP): $6.1 billion, up 10 percent;
• Gross profit margin:
  • GAAP: 51.8 percent, up 1.8 points;
  • Operating (non-GAAP): 52.3 percent, up 2.1 points;
• Revenue of $29.3 billion, down 1 percent, flat adjusting for currency:
  • Up 1 percent excluding divested RSS business adjusting for currency;
• Free cash flow of $9.5 billion, up $0.6 billion;
• Software revenue up 3 percent, up 4 percent adjusting for currency;
• Services revenue down 2 percent, down 1 percent adjusting for currency;
• Services backlog of $140 billion, flat, up $1 billion adjusting for currency;
• Systems and Technology revenue down 1 percent, up 4 percent excluding RSS:
  • System z mainframe up 56 percent.

Full-Year 2012:

• Diluted EPS, up double-digits for 10thconsecutive year:
  • GAAP: $14.37, up 10 percent;
  • Operating (non-GAAP): $15.25, up 13 percent;
• Net income:
  • GAAP: $16.6 billion, up 5 percent;
  • Operating (non-GAAP): $17.6 billion, up 8 percent;
• Revenue of $104.5 billion, down 2 percent, flat adjusting for currency;
• Free cash flow of $18.2 billion, up $1.6 billion;
• Growth markets revenue up 4 percent, up 7 percent adjusting for currency:
  • BRIC countries up 7 percent, up 12 percent adjusting for currency;
• Business analytics revenue up 13 percent;
• Smarter Planet revenue up more than 25 percent;
• Cloud revenue up 80 percent.

Full-Year 2013 Expectation:

• GAAP EPS of at least $15.53 and operating (non-GAAP) EPS of at least $16.70.

IBM (IBM) today announced fourth-quarter 2012 diluted earnings of $5.13 per share, compared with diluted earnings of $4.62 per share in the fourth quarter of 2011, an increase of 11 percent. Operating (non-GAAP) diluted earnings were $5.39 per share, compared with operating diluted earnings of $4.71 per share in the fourth quarter of 2011, an increase of 14 percent.

Fourth-quarter net income was $5.8 billion compared with $5.5 billion in the fourth quarter of 2011, an increase of 6 percent. Operating (non-GAAP) net income was $6.1 billion compared with $5.6 billion in the fourth quarter of 2011, an increase of 10 percent.

Total revenues for the fourth quarter of 2012 of $29.3 billion decreased 1 percent (flat adjusting for currency) from the fourth quarter of 2011. Without the impact of the divested Retail Store Solutions (RSS) business, revenue increased 1 percent, adjusting for currency….”

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Costs per click down 6%

Payed clicks up 24%

Preliminary report

CNBC is reporting that options activity is expecting a 3% move up or down given the number of $195 straddles being placed today…

“SAN FRANCISCO (MarketWatch) — International Business Machines Corp. is expected to post a gain in fourth-quarter earnings despite flat revenues when it reports its results on Tuesday afternoon.

This may help Big Blue gain its way back into investors’ good graces. IBM’sIBM +0.23% shares took a hit in October, after the company reported a rare earnings decline after revenue fell across the company’s key segments. The stock is down about 8% since the last report, having closed at a record high of $211 immediately prior.

Sentiment on Wall Street is mixed on the tech giant, with slightly more than half the covering brokers rating the stock as a neutral.

“Investors have held to the notion that IBM can protect earnings through sluggish times, which was somewhat called into question based on last quarter’s in line earnings,” wrote Joseph Foresi of Janney Capital in a note on Friday.

For the fourth quarter, analysts expect IBM to post earnings of $5.25 per share on revenue of $29.1 billion, according to consensus forecasts from FactSet. That compares with earnings of $4.71 per share on revenue of $29.5 billion for the same period last year….”

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“Apple Inc. (AAPL) Chief Executive Officer Tim Cook is feeling the heat.

Eighteen months after taking over from Steve Jobs, Cook is facing rising production costs, competition from Samsung Electronics Co. (005930) and slowing growth in smartphones, threatening profits for the world’s most valuable company.

An earnings report tomorrow may show that fiscal first- quarter net income slipped 2 percent to $12.8 billion, or $13.48 a share, according to analysts’ estimates compiled by Bloomberg. In all except one quarter since 2003, profit has jumped more than 10 percent. Analysts project sales will rise 18 percent to $54.8 billion, the slowest growth rate since 2009.

Apple’s shares have dropped almost 30 percent since September, erasing about $190 billion in market value, on concern that demand for iPhones and iPads is ebbing. Cook, 52, overhauled most of the company’s product line ahead of the holiday shopping season, and results for the period will show for the first time whether the effort paid off.

“Sentiment could not be worse,” said Peter Karazeris, an analyst at Thrivent Financial for Lutherans, which owned about 647,000 Apple shares as of September. “It does take something fundamental to turn that, and we’ll see if they can deliver.”

Apple often reports results that surpass even the most optimistic projections, and it’s possible the company will do so again tomorrow. The company has exceeded analysts’ estimates for earnings in all but three quarters since at least 2006, according to data compiled by Bloomberg.

Parts Purchases…”

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“Shares of insurance company Travelers Cos were signaling a positive start Tuesday, climbing in pre-market trading. The gain came after the company managed to post a fourth-quarter profit despite the impact of Superstorm Sandy.

Travelers reported operating income of $278 million, or 72 cents per share, down 54.4% from $609 million a  year earlier but still ahead of analyst expectations.

Sandy was the culprit behind the drop, producing the bulk of a sizable increase in catastrophe losses over the prior year. Losses from Sandy accounted for $669 million of the $689 million in after-tax catastrophe losses at Travelers (and more than $1 billion pre-tax). In the similar quarter a year ago after-tax catastrophe losses were just $68 million.

Despite the hit from Sandy, Travelers full-year operating income was up 71.4% to $2.4 billion. “We are pleased with our fourth quarter results, as well as our full year results, particularly in light of Storm Sandy,” said Chairman and CEO Jay Fishman, touting the encouraging pricing trends and renewal rates across the company’s business lines….”

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“Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX) reported fourth quarter and full-year 2012 results before markets opened this morning. The mining company posted diluted quarterly earnings per share (EPS) of $0.78 on revenues of $4.51 billion. In the same period a year ago, Freeport-McMoRan reported EPS of $0.67 on $4.16 billion in revenues. Fourth-quarter results also compare to the consensus estimates for EPS of $0.70 on revenues of $4.47 billion.

For the full year, the company reported adjusted EPS of $3.19 on revenues of $18.01 billion, compared with EPS of $4.78 in 2011 on revenues of $20.88 billion. The consensus estimates called for EPS of $3.15 on revenues of $18.15 billion.

The company’s CEO said…”

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“DOVER, Del. (AP) — Chemical and bioscience company DuPont Co. says weakness in its performance chemicals and electronics and communications businesses, coupled with costs associated with growth initiatives, led to a sharp drop in fourth-quarter income.

The company on Tuesday reported net income for the quarter ending Dec. 31 of $111 million, or 12 cents per share, excluding significant items, compared to net income of $373 million, or 40 cents per share, for the fourth quarter of 2011.

But the results beat the consensus estimate of Wall Street analysts of 7 cents per share. Its shares rose 91 cents, or 1.9 percent, to $47.90 in premarket trading.

DuPont chairwoman and CEO Ellen Kullman said the company is stronger than it was a year ago, having posted a record year in new product introductions.

“However, weakness in markets served by performance chemicals and electronics and communications provided significant challenges in 2012,” she said. “We’ve adjusted our plans to meet the changing market environment and grow our businesses in a slow-growth world economy.”

Sales for the quarter were flat at $7.3 billion, with currency effects and portfolio changes offsetting a 3 percent increase in global volumes. Sales in Latin America grew 10 percent, with an 8 percent volume gain and a 7 percent increase in local prices. A 6 percent increase in volume in the Asia-Pacific region, was offset by negative currency and pricing effects.

Analysts expected revenue of $7.2 billion.

One-time items affecting fourth-quarter results included $135 million to resolve legal claims stemming from the use of DuPont’s Imprelis weedkiller, bringing the total amount spent on Imprelis claims to $750 million.

DuPont, based in Wilmington, Del., also recorded asset impairment and restructuring charges totaling $99 million, and a pretax gain of $117 million associated with the sale of a business within its agricultural unit….”

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“NEW YORK (AP) — Verizon Communications’ fourth-quarter loss widened, dragged down by restructuring, pension and Superstorm Sandy costs. The company activated a record number of new devices on its contract-based plans during the period.

The parent of the country’s biggest wireless carrier lost $4.23 billion, or $1.48 per share, for the period ended Dec. 31. That compares with a loss of $2.02 billion or 71 cents per share, a year ago.

Adjusted earnings were 38 cents per share, which includes 7 cents per share for Superstorm Sandy. When stripping out Sandy’s impact, earnings were 45 cents per share.

Operating revenue rose 6 percent to $30.05 billion from $28.44 billion.

Analysts polled by FactSet expected earnings of 50 cents per share on revenue of $29.82 billion.

The company’s stock fell 84 cents, or 2 percent, to $41.70 in premarket trading Tuesday.

Verizon Wireless revenue climbed 9.5 percent to $20 billion. At the wireline division, operating revenue fell 1.5 percent to $10 billion.

Verizon Communications Inc. activated 2.1 million net new devices on contract-based plans, helped by the iPhone 5’s launch and by data plans rolled out over the summer.

There were 144,000 FiOS Internet and 134,000 FiOS Video net additions in the quarter, bringing the company to a total of 5.4 million FiOS Internet and 4.7 million FiOS Video customers.

For the year, Verizon Communications earned $875 million, or 31 cents per share. In the previous year it earned $2.4 billion, or 85 cents per share. Annual operating revenue increased to $115.85 billion from $110.88 billion.

Total debt for 2012 declined to $52 billion from $55.2 billion.

Verizon’s report marks the debut for telecommunications companies this earnings season. Rival AT&T Inc. reports on Thursday.”

Source 

“NEW BRUNSWICK, N.J. (AP) — Higher sales helped Johnson & Johnson post a much bigger fourth-quarter profit than a year ago, when a slew of charges depressed results.

The New Brunswick, N.J., company says net income was $2.57 billion, or 91 cents per share, up from $218 million, or 8 cents per share, in 2011’s fourth quarter.

Excluding about $800 million in one-time acquisition and litigation charges, earnings in the latest quarter would have been $3.38 billion, or $1.19 per share. That beat the expectation of analysts by 2 cents per share.

The maker of prescription drugs, consumer health products and medical devices says revenue totaled $17.56 billion, just shy of analysts’ average estimate of $17.69 billion.

J&J said it expects full-year profit of $5.35 to $5.45 per share. Analysts had expected $5.49.”

Source

“MINNEAPOLIS (AP) — Delta says its fourth-quarter profit was nearly wiped out by Superstorm Sandy and special charges.

Delta recorded a profit of $7 million for the quarter, or a penny per share. During the same period last year it earned $425 million, or 51 cents per share.

Delta says that without special items it would have earned $238 million, or 28 cents per share.

Revenue rose 2 percent to $8.6 billion. Both its adjusted profit and its revenue were slightly better than expected by analysts surveyed by FactSet.

Superstorm Sandy hurt revenue by $75 million. The storm slowed down the re-opening of Delta’s new oil refinery, causing a $63 million loss at the refinery.

Shares of Delta Air Lines Inc., based in Atlanta, are up a penny to $13.62 in premarket trading.”

“With 72 percent of corporate earnings exceeding analysts’ estimates, it may be difficult for U.S. stocks not to reach a record in 2013.

The Standard & Poor’s 500 Index is 5.1 percent below the all-time high in October 2007. Profits in the benchmark gauge are forecast to exceed $1 trillion this year, or 31 percent more than when the gauge peaked, according to more than 11,000 analyst estimates compiled by Bloomberg. Even if the price- earnings ratio, now 9.8 percent below the six-decade mean, doesn’t expand, the S&P 500 is poised to recover fully from the financial crisis that began almost six years ago.

Last week, the S&P 500 hit a five-year high as 48 of the 67 companies that reported results exceeded analyst estimates in the biggest expansion in profits since the technology bubble of the 1990s. While bears say the rally will stall when forecasts prove too high, bulls say U.S. companies generating more income than ever will push stocks to new records.

“Corporate America has done an incredible job post- recession,” Leo Grohowski, BNY Mellon Wealth Management’s New York-based chief investment officer said in a Jan. 16 phone interview. His firm oversees $179 billion. “It’s not going to be a return to the ’80s and ’90s where we had people retiring from their day jobs to become day traders. I wouldn’t revert to the historic P/E ratio kind of environment. But the good news is I don’t think we need that to reach a record….”

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“SunTrust Banks Inc.’s (STI) fourth-quarter profit surged as the regional bank recorded strong non-interest income, primarily due to higher mortgage-related and investment banking revenue.

Based in Atlanta, SunTrust is considered one of the nation’s most attractive regional banks because of its strong position in the South, an area that was hard hit by the housing downturn. But of late SunTrust, like its peers, has found its results challenged by an uncertain economy and low interest rates. In October, SunTrust told investors that revenue from lending and investing would likely decline next year, and the profit margin in that business should fall.

Friday, SunTrust reported that its net interest margin narrowed to 3.36% from 3.46% a year earlier and 3.38% in the third quarter.

Last week, SunTrust was part of a group of 10 banks that said they would pay $8.5 billion to close a regulatory probe and end a process set up in 2011 amid public outrage over banks’ foreclosure practices….”

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“General Electric Co. (GE) reported higher profit than analysts estimated as earnings rose at all of its industrial businesses for a second straight quarter.

Adjusted income from continuing operations gained 13 percent to $4.67 billion, or 44 cents a share, in the last three months of 2012, GE said today in a statement. That topped an averageprojection of 43 cents a share in a Bloomberg survey of 13 analysts. Sales climbed 4 percent to $39.3 billion.

GE overcame a year-end slump that deepened as President Barack Obama and his opponents in Congress negotiated to avoid $600 billion of automatic spending cuts and tax hikes that had been scheduled to begin taking effect on Jan. 1. Orders for industrial equipment from grew 2 percent in the fourth quarter, pushing its backlog to a record $210 billion.
“You see the slow but steady transition to industrial leadership to drive GE’s growth,” said Nick Heymann, an analyst at William Blair & Co. in New York, in an interview on Bloomberg TV with Tom Keene. “Order growth, while it slowed, didn’t stall and you continue to see better pricing.”
GE gained 3.4 percent to $22.03 at 7:38 a.m. in pre-market New York trading. The stock climbed 17.2 percent last year compared with a 13.4 percent gain for the Standard & Poor’s 500 index….”

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“Morgan Stanley (MS), the top global equity underwriter last year, reported earnings that beat analysts’ estimates as revenue from the retail brokerage climbed.

Fourth-quarter profit was $507 million, or 25 cents a share, compared with a loss of $250 million, or 15 cents, a year earlier, the New York-based company said today in a statement. Excluding accounting charges tied to the firm’s own debt, profit was 45 cents a share, beating the 27-cent average estimate of 24 analysts surveyed by Bloomberg….”

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” American Express Company (AXP) today reported fourth-quarter net income of $637 million, down 47 percent from $1.2 billion a year ago. Net income from the quarter included the restructuring charge, rewards expense and cardmember reimbursements that were announced last week. Diluted earnings per share was $0.56, down 45 percent from $1.01 a year ago.”

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“Intel (INTC) this afternoon reported Q4 revenue in line with expectations and profit per share that topped analysts’ expectations, and a forecast for this quarter’s revenue slightly below estimates.

Revenue in the three months ended in December rose to $13.5 billion, yielding EPS of 48 cents.

Analysts had been modeling $13.52 billion and 45 cents.

For the current quarter, the company projects $12.7 billion in revenue, slightly below the $12.9 billion analysts have been projecting.”

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“Herbalife Ltd. HLF -3.68% said preliminary results for its fourth quarter and for 2012 were above its prior expectations.

However, shares were under pressure in premarket trading, perhaps reflecting investor disappointment that the company didn’t accelerate its stock buyback, as Fox News earlier this week reported was expected. On Thursday, Herbalife said it expects to begin repurchasing shares under its existing share-repurchase authorization.

For the year, the nutritional-supplement maker expects per-share earnings between $4.02 to $4.05 on revenue growth between 18% to 20%. In October, Herbalife had said it expected per-share earnings for the year between $3.99 to $4.03 on revenue growth of 16% to 18%.

For the fourth quarter, Herbalife said per-share earnings would be between $1.02 and $1.05, with revenue growth the same as the year’s level.

The company had previously estimated per-share earnings between 97 cents to $1.01 on revenue growth between 17% to 19%…”

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“(Reuters) – UnitedHealth Group Inc , the largest U.S. health insurer, said on Thursday it kept fourth-quarter costs under control and increased revenue by more than 11 percent, helping earnings per share to rise.

The company, which provides health care benefits through both employer and government-paid insurance plans and serves individuals and military members, also backed its forecast for 2013revenue growth of at least 11 percent and said earnings would be in a range of slightly down to up 4 percent.

UnitedHealth’s business has benefited in recent years as consumers cut back on medical services because of the weak economy, but the company also has had to adapt to new rules for insurers associated with the 2010 Patient Prevention and Affordable Care Act.

“There wasn’t a whole lot of surprises in there. They came in line with consensus on earnings,” said Jason Gurda, an analyst at Leerink Swann. Operating costs were higher, he said.

UnitedHealth said that while fourth-quarter commercial medical costs rose, they were a bit lower than it expected. Its medical loss ratio, or the percentage of premiums paid for medical expenses, was 80.5 percent.

The Affordable Care Act in 2011 began requiring companies to spend at least 80 percent or 85 percent of premiums on medical care or provide a rebate to customers.

UnitedHealth, which bought 65 percent of Brazil’s Amil Participacoes for $3.5 billion during the quarter, plans to increase its stake by 25 percent through buying shares from the public during the first half of 2013. The affiliate helped push international revenues to $1 billion in the fourth quarter, the company said.

Optum, its growing health technology division, had revenue of $7.5 billion during the quarter and added $459 million to operating earnings.

FINISHES 2012 WITH 83.7 MLN CUSTOMERS…”

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“Bank of America Corp. reported profit dropped 63 percent as costs mounted from faulty foreclosures and flawed home loans made as long as a decade ago.

Net income dropped in the fourth quarter to $732 million, or 3 cents a diluted share, from $1.99 billion, or 15 cents, a year earlier, according to a statement today from the Charlotte, North Carolina-based company. Adjusted for one-time items, profit was 29 cents a share, beating the 20-cent estimate of 18 analysts surveyed by Bloomberg. Revenue dropped 25 percent.

Chief Executive Officer Brian T. Moynihan has spent his first three years cleaning up after his predecessor’s takeover of Countrywide Financial Corp. and Merrill Lynch & Co., selling more than $60 billion of assets in the process. The bank announced an $11.7 billion deal to end disputes with Fannie Mae on bad home loans this month and joined an $8.5 billion industry accord to compensate for abusive foreclosures.

Last year “was about resolving as many issues as they could,” said Marty Mosby, an analyst at Guggenheim Securities LLC, which manages more than $100 billion, including Bank of America stock. “While they’ve had to absorb some losses, they were less than the worst case, and that signifies progress….”

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