Wall Street Brief: Nokia Drop Kicked, Netflix is Crashing Post Earnings
Fitch Ratings has downgraded Nokia (NYSE:NOK) from “BBB-” to “BB+” or to formerly known as junk status. This comes as the handset maker sits on a pile of EUR 4.9 billion of net cash. The agency said it may further cut the company’s ratings unless its performance begins to improve in this year’s second half and in 2013. Given the challenges Nokia may face, Fitch is unconvinced that the company can get through this.
Netflix (NASDAQ:NFLX) earnings are in, and investors are selling the stock hand over fist. Netflix shares are down over 13% after announcing a first-quarter loss of $4.58 million, compared to a profit of $60.23 million a year earlier. The company expects subscriber growth to slow in the current second quarter. Get more details in Your Cheat Sheet to Netflix Inc. Earnings >>
Apple (NASDAQ:AAPL) will report its earnings after the bell on Tuesday and it is expected to show its continued onslaught with its earnings per share forecast of $10.06 vs. $6.40 and a revenue increase of 49 percent to $36.8 billion. Lately, there’s been a decent amount of cautious commentary about the upcoming report. One BCG analyst has predicted that from emerging markets buyers’ price sensitively, which has added to a strong Android demand, it will hamper Apple’s growth. Get some perspectives now by reading Apple Earnings: Your Cheat Sheet to Wall Street Analyst Chaos >>
Yahoo Japan Corp’s share buyback talks with its key shareholder Yahoo Inc (NASDAQ:YHOO) have ended without an agreement reported Retuers but the two companies are open to future talks for additional negotiations. Yahoo Japan’s chief financial officer Toshiki Ohya said to reporters, “We want to positively consider resuming negotiations if the conditions are right.” Last week, Yahoo’s chief executive, Scott Thompson said the company’s plans to sell its Yahoo Japan stake but it had been hit by a “valuation gap” that the parties could not come together on.
The Bank of Japan is expected to ease its monetary policy on Friday, according to Reuters. It will increase its YEN30 trillion ($370 billion) asset purchase program by YEN 5 trillion (YEN 10 trillion). In addition, the bank could also broaden the government bonds’ maturity that it purchases from two years to three years.
6 Early Buzzing Stocks: Apple Declines 2%, Netflix Drops 15%
Shares of Apple Inc. (NASDAQ:AAPL) declined 2.08 percent in early market trading. The tech giant is now below its 50-day moving average. AT&T (NYSE:T) added to iPhone concerns after reporting it essentially gained no phone subscribers on contract-based plans in the first quarter.
Netflix Inc. (NASDAQ:NFLX) shares dropped more than 15 percent before the opening bell. Late Monday, the media company reported a first-quarter loss of $4.58 million, compared to a profit of $60.23 million a year earlier. Furthermore, the company expects subscriber growth to slow in the current second quarter.
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AK Steel Holding Corp. (NYSE:AKS) shares slipped .55 percent Tuesday morning. The company reported a loss of $11.8 million for the first quarter, compared to a profit of $8.7 million a year earlier. Revenue also declined from $1.58 billion to $1.51 billion.
Big Lots Inc. (NYSE:BIG) dropped 18.5 percent in pre-market trading after announcing late Monday it is reducing its first-quarter U.S. same-store sales expectations. The company said in a press release, “U.S. comp store sales were on plan for the first six weeks of the quarter. However, sales compared to plan began to slow in late March and trends have further softened as we move through the month of April.”
Shares of 3M Co. (NYSE:MMM) jumped 2.5 percent Tuesday morning. The company reported first quarter net income of $1.13 billion ($1.59 per share), compared to $1.08 billion ($1.49 per share) a year earlier.
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Active Stocks: AT&T, Texas Instruments, Netflix April 24th
AT&T Inc. (NYSE:T): AT&T said business revenues had their best year-over-year comparison in the last three years. Total business revenues were $9.2B, down 0.8% versus the year-earlier quarter. Business service revenues declined 0.3% year over year, compared to a year-over-year decline of 4.4% in the year-ago quarter, and were essentially flat sequentially. Declines in legacy products were largely offset by continued strong growth in strategic business services. Revenues from strategic business services, the new-generation capabilities that lead AT&T’s most advanced business solutions including Ethernet, VPNs, hosting, IP conferencing and application services grew 19.0% versus the year-earlier quarter, continuing strong trends in this area. This now represents a $6.2B annualized revenue stream. Total business data revenue growth accelerated to 4.2% year over year, the strongest showing in four years. Shares of AT&T Inc. are trading 3.5% higher today.
Waters Corporation (NYSE:WAT): Waters reported Q1 EPS $1.00 versus consensus $1.09 Reported Q1 revenue $420M, consensus $441.84M. Shares of Waters Corporation are trading 8.86% lower today.
Texas Instruments Incorporated (NASDAQ:TXN): CLSA views Texas Instruments’ valuation as reasonable but continues to avoid shares given lack of operating leverage. Shares of Texas Instruments Incorporated are trading 0.25% lower today.
Netflix, Inc. (NASDAQ:NFLX): Netflix (NASDAQ:NFLX) CEO Reed Hastings has suggested in a letter to investors that Comcast (NASDAQ:CMCSA) is competing unfairly in the streaming-video space, CNet reports. Hastings says Comcast was providing the company’s Xfinity Web-video service a competitive advantage “not offered to Netflix or other competitors…That is not neutral in any sense.” Shares of Netflix, Inc. are trading 13.59% lower today.
Align Technology, Inc. (NASDAQ:ALGN): JMP Securities increased its target on Align after the company reported stronger than expected Q1 results. The firm reiterates an Outperform rating on the stock. Shares of Align Technology, Inc. are trading 15.71% higher today.
Coach, Hershey, Lexmark, Symantec Attract High Trading Interest April 24th
Coach, Inc. (NYSE:COH): Sees North America square footage growth about 10% this year driven by Men’s. Says to expand Men’s to nearly 100 Coach Retail stores in North America. Says has about 30 locations planned in China, sees net square footage growth about 5% this year in Japan. Shares of Coach, Inc. are trading 3.95% lower today.
The Hershey Company (NYSE:HSY): Sees FY12 reported EPS $2.82-$2.92. Sees FY12 net sale sup 7%-9%, including Brookside acquisition, consensus $6.51B. The forecast for total pre-tax GAAP charges and non-recurring project implementation costs related to the Project Next Century program remains at $150 M-$160M. Shares of The Hershey Company are trading 6.26% higher today.
Lexmark International Inc (NYSE:LXK): The increase in EPS growth due to increase in core growth, significant growth in Perceptive Software revenue, and a lack of Thailand expenses. It also sees restructuring savings and large workgroup hardware in 2H12. Shares of Lexmark International Inc are trading 5.59% lower today.
Symantec Corporation (NASDAQ:SYMC): Consensus is 43c. Sees Q1 GAAP deferred revenue growth 1.7%-1.3%, consensus $1.7B. Shares of Symantec Corporation are trading 8.91% lower today.
Illinois Tool Works Inc. (NYSE:ITW): The company said, “Both our first quarter earnings and operating margins exceeded our expectations and our return on invested capital was within our target range. Despite uneven end market demand in Europe, we remain optimistic about our full-year prospects.” Shares of Illinois Tool Works Inc. are trading 2.03% higher today.
5 Stocks Hitting Radars: Apple Reports Blow-Out Earnings, Finishes Quarter with $112 Billion Cash Hoard
Shares of Apple Inc. (NASDAQ:AAPL) jumped more than 7 percent after the closing bell. The tech giant reported another blow-out quarter, earning $11.62 billion ($12.30 per share), compared to $5.99 billion ($6.40 per share) a year earlier. Revenue also surged 58.9 percent to $39.19 billion, beating estimates of $36.49 billion. The company’s cash hoard rose $12.6 billion to $110 billion. Apple: We’re Unstoppable!
Despite beating estimates, Baidu Inc. (NASDAQ:BIDU) shares dropped 10.25 percent in late market trading. The company earned $299 million (87 cents per share) in the first quarter, a 76 percent increase from a year earlier. “We’ve started the year with solid financial results and steady business progress,” said Robin Li, chairman and chief executive officer of Baidu. “Although this is usually a seasonally slow quarter, our effective sales and marketing efforts enabled us to expand our SME customer base significantly.”
Investor Insight: Apple Earnings Cheat Sheet: Earnings Smash Expectations
After closing down 5.86 percent during regular trading, shares of Buffalo Wild Wings Inc. (NASDAQ:BWLD) edged .35 percent higher in extended trading hours. The company reported first quarter earnings of $18.2 million (98 cents per share), compared to $14.9 million (81 cents per share) a year earlier.
Juniper Networks Inc. (NYSE:JNPR) shares increased more than 2 percent late Tuesday. The company reported adjusted net income of 16 cents per share for the first quarter, beating the mean estimate of only 7 cents per share. “Our first quarter results reflect solid execution across Juniper,” said Kevin Johnson, CEO of Juniper Networks. “We are pleased with initial customer response to our differentiated new products and solutions, which help form the broadest, most robust product portfolio in our Company’s history.”
AFLAC Inc. (NYSE:AFL) shares jumped 4.76 percent after reporting strong first quarter results. The insurance company earned $785 million ($1.68 per share), compared to $389 million (85 cents per share) a year earlier. Revenue also increased from 21.9 percent to $6.24 billion. “Despite challenges that remain in the U.S. economy, we continue to focus on expanding our reach to employees at companies, large and small,” explained Chairman and Chief Executive Officer Daniel P. Amos.
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