Earnings Recap: J Crew (JCG), Novell (NOVL), Blue Coat Systems (BCSI)

J Crew Group (NYSE: JCG): Another solid Q from JCG.

Earnings: Q1 profits of $0.68 vs. $0.57 consensus and $0.32 for Q1 last year.

Revenue: Up 20% to $414 million vs. $394 million consensus.

“It’s a take-from-your-competitors business,” noted CEO Mickey Drexler.

Comment: JCG finished the day up more than 4% and has added another 1% during after-hours trading.  In addition to beating on the Q, the company also upped Q2 and FY guidance.  Gross margins were up to 49% from 42% last year mostly due to decreased markdowns and promotions, and direct sales were up 20%.  S&P maintained a Hold rating on shares, but if you’re looking to add a retailer to your portfolio, JCG is a solid choice.

Novell Inc. (NASDAQ: NOVL): Will a decent Q generate new takeout rumors?

Earnings: Q2 profits, excluding items, of $0.07 vs. $0.07 consensus.

Revenue: Down 5.4% to $204 million.

Novell is “excited” about its traction with service providers, and about the take-up of its software for managing virtual machine environments, remarked CEO Ron Hovsepian.

Comment: Novell planned to accept bids from potential buyers earlier this month, kicking off a process that will likely result in a sale of the company. The company put itself up for sale in March, after a hedge fund made an unsolicited offer of $5.75 per share. Novell rejected that offer, which valued the company at around $2 billion, but said it would entertain other bids.  Shares closed Monday up 1.55% but have lost .5% after-hours, last changing hands at $5.87.

At this point, NOVL is a play on an eventual take out, so if you think they can generate an offer for more than $5.75, then you’ve got a shot at making a quick buck.  Just don’t think of the company as a long-term investment.

Blue Coat Systems Inc. (NASDAQ: BCSI): Down hard on soft guidance.

Earnings: Q4 profits of $0.40 vs. $0.40 consensus and $0.19 for Q4 last year.

Revenue: Up 17% to $133 million.

“Demand growth was driven by customers’ network upgrades and efforts to stop malicious attacks and maintain regulatory compliance,” noted one analyst.

Comment: Despite appearing to be a decent Q at first glance, BCSI’s revenue guidance for the next Q came in at $121 – $126 million vs. estimates of $132 million and shares are being destroyed after-hours as a result, last changing hands at $23.95, down nearly 17%.  This is an important technical area, as BCSI is now hovering around its February lows of $23.72.  Below that, shares won’t hit solid support until about $22.  So, if you’re interested in picking a bottom, wait to see if shares hold their Feb lows and maintain a tight stop should you decide to open up a position.

Disclosure: No holdings in JCG, NOVL, BCSI