From Briefing.com: There were six-and-a-half hours of trading and 1.65 bln shares were traded, and yet, when it was all said and done, the Nasdaq was essentially unchanged on Thursday, having slipped 0.50 points. In absolute terms, the decline is negligible, but psychologically, it carries some weight as the Nasdaq, once again, was unable to sustain an advance despite another round of favorable economic data and an improvement in the bond market following the 10-yr note auction. Moreover, it was the second straight day the Nasdaq closed below its 50-day simple moving average and it marked the fifth consecutive loss for the tech-heavy composite.
Consistent with the flat performance, the tech sector was mixed with few movers of note from an industry perspective. Fittingly, most of the winners and losers in the tech sector on Thursday moved less than a point. The biotech shares played a supportive role for the Nasdaq as gains in that space contributed to a 1.3% bounce in the BTK index, which was down 6.9% for the week prior to Thursday's session.
For the most part, most of Thursday's buying interest was concentrated in blue chip industry groups like financial, energy, drug, and retail. The latter was the standout on the day following a batch of encouraging same-store sales results for July. The drop in interest rates, and the underperformance of the blue chips relative to the tech stocks, contributed to their appeal in what was a fairly lackluster day of trading.
On Friday, there are no economic releases and no earnings reports of note. Hence, we'd expect volume to be on the light side of things as traders opt to get an early start on the weekend. In light of the tech sector's feeble showing this week, a bounce-back day wouldn't come as a surprise. Nevertheless, with the market a bit anxious these days, we'd suggest investors refrain from committing new money, and instead, consider securing some profits in tech stocks or looking for ways to insure them.-- Patrick J. O'Hare, Briefing.com
5:44PM Thursday After Hours Price levels are as of 4 pm EST: It was a mixed day on Wall Street, as stocks opened lower and then rallied into positive territory. After hearing generally positive same store sales numbers, the market needed some time to digest all that information. The Dow closed higher by more than 64 points and stands at 9126, the S&P 500 gained seven points and closed at 974. S&P 500 futures were at 974, one point above fair value. NASDAQ 100 futures were up one point from fair value at 1219.
Univision (UVN 28.90 +0.00) Reported Q2 (Jun) earnings of $0.16 per share, $0.03 better than the Reuters Research consensus of $0.13. Revenues fell 0.8% yr/yr to $320.2 mln better than the $333.9 mln consensus. The Company sees Q3 EPS in the range of $0.11-0.13, R.R. with the current consensus of $0.12.
Emulex (ELX 21.40 -0.02) Released Q4 (Jun) earnings of $0.23 per share, ex items, $0.01 better than the Reuters Research consensus of $0.22. Revenues rose 16.5% yr/yr to $81.8 mln, slightly better than the $81.7 mln consensus. ELX sees Q1 EPS of $0.23, ex items, R.R. consensus is $0.22, and revenues of $82-85 mln, estimate $84 mln.
Pixar Animation (00C0 64.54 -1.01) Announced Q2 (Jun) earnings of $0.34 per share, $0.13 better than the Reuters Research consensus of $0.21. Revenues rose 114.5% yr/yr to $48.9 mln well above the $27.6 mln consensus.
NVIDIA (NVDA 17.15 -2.15) Reported Q2 (Jul) earnings of $0.14 per share, $0.03 better than the Reuters Research consensus of $0.11. Revenues rose 7.6% yr/yr to $459.8 mln and better than the $458.2 mln consensus.
Winn-Dixie(WIN 11.77 -0.01) Released Q4 (Jun) earnings of $0.28 per share, excluding items totalling a $0.16 gain, in line with the Reuters Research consensus of $0.28. Revenues fell 4.5% yr/yr to $2.73 bln and were slightly above the $2.72 bln consensus.
In a non earnings related event, Coach (COH 51.70 -0.22) declared a 2-for-1 stock split.
Tomorrow looks to be another summer Friday for the markets, which have been characterized by small volumes and days off.
For more detail on these, and other after hours developments, be sure to visit Briefing.com's In Play, Earnings Calendar and Guidance pages..--Brian Bolan, Briefing.com
5:28PM NVIDIA lowers Q3 guidance (NVDA) 17.65 -1.92: -- Update -- On call, management indicates Q3 (Oct) gross margins are to remain flat to slightly down and operating expenses are to increase 5-10%. The company expects Q3 revenues to increase 5-6%, implying a range of $482.8-487.4 mln. The Reuters Research consensus is for revenues of $495.9 mln.
4:22PM NVIDIA beats by $0.03 (NVDA) 19.30 -0.27: Reports Q2 (Jul) earnings of $0.14 per share, $0.03 better than the Reuters Research consensus of $0.11; revenues rose 7.6% year/year to $459.8 mln vs the $458.2 mln consensus.
Close Dow +64.71 at 9126.45, S&P +7.04 at 974.12, Nasdaq -0.47 at 1652.21: In a last ditch effort, the major indices put together a respectable rally effort to end the day moderately higher for the blue chip averages, and only slightly lower for the Nasdaq... The Dow and S&P 500's abilities to hold above the lower end of their two month ranges incited a blue-chip buying drive in the last hour of trading, and also helped improved the standing of the comparatively weaker Nasdaq...
That was not the story, however, for most of day as the stock market hovered around the unchanged mark, undercut by a lack of conviction from buyers who where put off by the stock market's poor showing over the past four sessions... Those same concerns - specifically worries regarding the valuation of stocks, the sharp rise in interest rates, and the recent deterioration of the indices - kept investors from making substantial changes to positions, and took precedence over a batch of economic data pointing to a strengthening economy... Among the more notable reports, jobless claims for the week of August 2 dropped 3K to 390K (consensus of 395K) for their lowest level in six months, and the Q2 productivity figure rose at its fastest rate since 3Q02 to 5.7% (consensus of 4.0%)...
Despite this, the indices spent most of the day trading in lackluster fashion, with industry leadership particularly weak... Technology stumbled the most, due in large part to profit-taking activity in semiconductor and large-cap technology issues... Retail, however, tacked up considerable gains following a strong set of July same store sales numbers... Wal-Mart (WMT 57.00 +1.26), in particular, saw its comparable store sales increase to 4.6%, above the consensus expectation of 3.6%, and raised its Q2 (July) guidance to $0.52 (consensus of $0.50) from $0.49-0.51...NYSE Adv/Dec 2022/1230, Nasdaq Adv/Dec 1463/1640
3:50PM Bell Micro files for $35 mln mixed offering (BELM) 6.28 -0.32:
3:25PM NVIDIA Earnings Preview (NVDA) 19.26 -0.31: Nvidia is scheduled to report Q2 results after the close, with consensus ests standing at $0.11 in EPS and $458.2 mln in sales (note that the co preannounced revs of $455-$460 mln on July 28). Bear Stearns expects the co to report EPS of $0.11 on $456 mln in sales, with a 3-point reduction in gross margins to 28.3%; for Q3, firm expects a 2-point increase in gross margins, as they think the co should be able to resolve its NV31 manufacturing problems given that it has been producing on 0.13-micron process for over half a year now; however, firm does not expect a mkt share recovery soon in its core GPU biz, and does not expect to see a material impact on earnings from new initiatives such as introducing nForce to Transmeta, a possible entry into the AMD notebook chipset mkt, and the MediaQ acquisition.
3:16PM Bond Market Summary : Treasuries are finishing the day near their highs; ten-year note presently up 13/32nd's to yield 4.22%. The market got a little bit of an uptick this morning when favorable inflationary data (unit labor costs) counterbalanced stronger-than-expected economic growth data (nonfarm productivity, jobless claims). Market received a further bid on a relief trade following the completion of the final leg of this quarter's Treasury refunding. Absolutely nothing on the economic calendar the next three days. FOMC to meet Tuesday; please see our brand new Bond Brief for a preview.
3:13PM Economic Review - consumer credit : June consumer credit contracted $400 mln. We suspect the record amount of mortgage refinancing allowed borrowers to trade off the higher interest costs of credit cards for the lower cost of the refis. Revolving credit card debt fell -$1.3 bln as non-revolving credit (for cars, vacations, tuition, etc.) rose $0.9 bln. May consumer credit was revised higher to $8.1 bln (from $7.3 bln).
3:06PM Emulex Earnings Preview (ELX) 21.36 +0.91: Emulex reports Q4 results after the close tonight, with consensus ests standing at EPS of $0.22 and $81.7 mln in revs. JP Morgan expects the co to report basically in-line results of $0.22 in EPS and $81 mln in sales, but is concerned about enterprise storage spending in the seasonally-soft Sept qtr (specifically, Europe appears to be weakening); however, firm expects a strong Dec qtr based on year-end spending and improvements in the high-end storage mkt. On the other hand, Legg Mason expects ELX to report EPS of $0.23 and $82.4 mln in sales; firm expects revs to be at the high end of ELX's target range of $80-$82 mln based mostly on their belief that the co had exposure to an atypically strong June qtr for govt spending; however, firm is concerned about sales to HPQ, as checks are once again picking up troubling but inconclusive evidence of sporadic sales efforts in HPQ's enterprise systems group, while recent HPQ mgmt departures in this area also suggest trouble; in general, firm believes ELX is nearing the end of a period in which it has grown sales at rates substantially faster than the growth of the overall HBA mkt.
10:57AM XM Satellite -- Earnings Color (XMSR) 11.58 -1.69: --Update-- While co's slightly disappointing quarterly results appear to be weighing on stock, a more significant issue appears to be co's comments on insurance reimbursement. XMSR commented that a group of insurers recently denied co's claims relating to the power degradation trends experienced by its satellites, asserting that the satellites are still performing above the insured levels and the power trend lines are not definitive; these insurers also allege XM failed to comply with certain policy provisions regarding material change and other matters... Rodman & Renshaw (which rates the stock an Underperform) had previously assumed XM would receive 70% of its claim to cover those costs. Firm believes that this re-imbursement is now very much in question - increasing firm's estimates for a funding gap. According to firm, the worse than expected improvement in operating metrics, the decline in ARPU, coupled with the revelation that insurance proceeds were now in question, all highlight the risks associated with this business - despite the top-line growth.
9:20AM Semitool upgraded at DA Davidson; target $10 (SMTL) 6.05: DA Davidson upgrades to Buy from Neutral based on relative valuation as well as an improved cost structure, new technology that should displace competitors, and an improved industry-wide order outlook; raises target to $10 from $6.
9:15AM Hewlett-Packard Q3 ests trimmed at Goldman Sachs (HPQ) 19.89: Goldman Sachs trims their Q3 rev/EPS ests to $17.4 bln/$0.26 from $17.7 bln/$0.27, vs consensus of $17.5 bln/$0.26; firm says weakness in the European economy, soft enterprise sales, and a more aggressive PC pricing environment may make it difficult for HPQ to achieve the Street's Q3 rev est.
8:55AM AMAT target raised to $21 at Morgan Stanley : Morgan Stanley also comments on co's Aug 12 earnings report; firm believes that co's flat Q3 guidance is achievable, but believes expectations limit upside tied to the earnings report.
Broadcom (BRCM) 20.55 +0.54: Morgan Stanley upgraded to Overweight from Equal-Weight; firm believes that investors are discounting a worst-case scenario for the server segment in 2004, but are not adequately giving the stock credit for the co's strength in its other business segments; firm says BRCM's emerging product segment was already 30% larger than ServerWorks in Q2, and expect it to grow more than four-fold this year and more than 80% in 2004. Target is $30.
Intel (INTC) 23.99 -0.15: JP Morgan reiterated its Underweight rating on INTC, saying it remains the most expensive stock under coverage trading at 31x their CY04 EPS est, well above its pre-bubble range of roughly 10-20x; in addition, the co disclosed in its 10-Q that it has received notice from the IRS of a proposed adjustment relating to a tax benefit from export sales that could increase the co's tax liability for 1999-2000 by about $600 mln, which could result in a reduction in EPS of about $0.08 to FY99 and FY00 earnings.
Silicon Image (SIMG) 4.81 -0.09: Co announced that a federal court has issued its Final Judgment Order on the patent infringement suit against Genesis Microchip (GNSS). The court reaffirmed its July 15 ruling and ordered Genesis to make a cash payment as well as to pay all overdue quarterly royalty payments in exchange for licenses. None of the payments will be reflected in Silicon Image's financial reports if the judgment is appealed.
biz.yahoo.com |
