Ultimate Market Recap: Groupon’s 4Q Loss, Greece Agreement

Wall Street Watch: Greece Stalls, Groupon and PepsiCo Announce Earnings

After a marathon meeting, Greece’s political chiefs couldn’t reach agreement on reforms and austerity measures due to disagreements on pension cuts.Without the rescue plan and its funds, Greece will now likely default on its March bond repayment. Greek finance minister Evangelos Venizelos will now travel to a Brussels summit today with euro zone finance ministers and discuss the rescue plan.

China reported consumer prices increased 4.5 percent in January from the previous year. This is higher than the 4 percent expectation due to increased spending from a week-long holiday. The unexpected inflation acceleration will pressure officials to keep from making instant cuts in the banks’ reserve requirements, according to Bloomberg.

On Wednesday, Groupon (NASDAQ:GRPN) reported a $9.8 million fourth quarter loss ($0.02 per share). The is down from its $185 million loss for the same quarter in the previous year. Disappointed investors reacted by driving down the company’s stock 13 percent in after-hours trading. But there was good news for Groupon: its fourth quarter revenue rose 194 percent to $506.5 million from the same quarter a year ago, beating analysts’ estimates.

PepsiCo, Inc. (NYSE:PEP) reported its fourth quarter profit increased 4 percent to $1.42 billion ($0.89 cents per share), up from $1.37 billion ($0.85 per share) from 2010’s final three months. The company announced plans to cut three percent of its global workforce (8,700 employees) to produce $1.5 billion in savings by 2014, according to MarketWatch. The company will also increase its annual dividend by 4 percent to $2.15 per share, buy back at least $3 billion in stock and increase marketing spending near $600 million in 2012.

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Shares of PepsiCo. Inc. (NYSE:PEP) declined 2.8 percent early Thursday.  The company earned $1.42 billion (89 cents per share), compared to $1.37 billion (85 cents per share).  The company also announced plans to cut 8,700 jobs in an effort to offset high commodity costs.  Dr Pepper Snapple (NYSE:DPS) and Coca-Cola (NYSE:KO) also declined.

Apple Inc. (NASDAQ:AAPL) shares gained .77 percent and reached a new all-time high after receiving a higher price target from Canaccord.  The firm now has a price target of $655 for shares.  Shares of Microsoft (NASDAQ:MSFT) and Amazon (NASDAQ:AMZN) fell this morning.

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Yahoo! Inc. (NASDAQ:YHOO) shares jumped 2.2 percent.  Chairman Roy Bostock and three other directors are stepping down at the internet company.  Daniel Loeb, whose hedge fund owns 5 percent of Yahoo stock said, “We are disturbed but not surprised by this mismanagement given the history of strategic bungling by Yahoo Board Chairman Roy Bostock and founder Jerry Yang,”  Shares of AOL Inc. (NYSE:AOL) and Google Inc. (NASDAQ:GOOG) also edged higher.

TripAdvisor, Inc. (TRIP) shares plummeted more than 16 percent after shares were downgraded from buy to hold by analysts at Benchmark.  The travel company also projected lower revenue for 2012 than the previous year.  TripAdvisor was spun-off from Expedia Inc. (NASDAQ:EXPE) in December.

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iRobot, Akamai, Teradata, Bunge Shares Active Among Traders Feb 9th

iRobot Corporation (NASDAQ:IRBT): Robot maker iRobot eported Q4 EPS of 38c, compared with analysts’ consensus estimate of 32c. However, the company’s revenue came in lower than expected. Moreover, iRobot provided Q1 EPS guidance of (8c)-0c, versus the consensus estimate of 30c. The robot maker provided FY12 EPS guidance of 75c-95c, versus the consensus of $1.45. “As we look at 2012, we feel very good about the growth opportunity for our home robot business in 2012 and beyond,” said iRobot CEO Colin Angle. “However, we expect a decline in top and bottom line in our (government and industrial) division this year due to our current limited visibility in our defense business.,” Angle added. In a note to investors, JP Morgan responded to iRobot’s weaker than expected results by downgrading the stock to Underweight from Neutral. The firm lowered its target on the shares to $30 from $37.50. In early trading, iRobot plunged $11.51, or 30.05%, to $26.78. Shares of iRobot Corporation are trading 31.04% lower today.

Akamai Technologies, Inc. (NASDAQ:AKAM): Last night, Akamai (NASDAQ:AKAM) reported positive Q4 results. Adjusted EPS came in at 45c, beating consensus estimates of 40c, and revenue of $324M was ahead of the expected $311.26M. The company also named a new CFO, James Benson. Sentiment on the street was unanimously positive this morning, with several firms raising their price targets. Stifel Nicolaus raised its target on the shares to $43 from $32, while CLSA raised their target to $44 from $37. Both firms cited stronger than expected Q4 results and positive Q1 revenue guidance. Each has a Buy rating on the shares. Shares of Akamai Technologies, Inc. are trading 10.95% higher today.

Teradata Corporation (NYSE:TDC): Teradata’s board of directors has approved a new authorization to repurchase a total of $300M of the company’s shares under its general open market share repurchase program. The program has been extended for an additional three-year period now expiring in February 2015. As of January 31, the company had purchased a total of 18.2 million shares of its common stock investing approximately $475M of the $550M that was previously authorized under this program. Shares of Teradata Corporation are trading 7.53% higher today.

Bunge Limited (NYSE:BG): The Department of Agriculture lowered its projection for U.S. feed grain ending stocks for 2011/12, citing corn and oats imports being more than offset by higher expected corn exports. Corn ending stocks projections were dropped 45M bushels, to 801M. Season average farm corn price forecast was narrowed 10c on both ends of the range, to $5.80-$6.60 per bushel. Global coarse grain supplies for 2011/12 are projected 3.1M tons lower, on reduced corn production from Argentina and Paraguay. Shares of Bunge Limited are trading 2.66% higher today.

Taleo, Groupon, Diamond Foods, PepsiCo, Caesar Top Active Stock Alerts Feb 9th

Taleo Corp (NASDAQ:TLEO): Oracle (NASDAQ:ORCL) announced that it has entered into an agreement to acquire Taleo Corporation for $46 per share, approximately $1.9 billion, net of Taleo’s cash and debt. Taleo’s Talent Management Cloud helps organizations attract, develop, motivate and retain human capital to improve performance and drive growth. Shares of Taleo Corp are trading 16.91% higher today.

Groupon Inc (NASDAQ:GRPN): Ascendiant Capital believes Groupon’s first mover advantage is slowing due to competition and consumer fatigue. The firm believes profitability is weak, costs are high, and valuation is rich. Shares are Sell rated with a $14 price target. Shares of Groupon Inc are trading 11.59% lower today.

Diamond Foods, Inc. (NASDAQ:DMND): Proctor & Gamble (NYSE:PG) issued the following Pringles transaction update: “Diamond Foods issued a news release announcing that its financial statements for 2010 and 2011 could not be relied on and would need to be restated. It also placed its President and CEO, Michael Mendes, and CFO, Steven Neil, on administrative leave and commenced a search for their permanent replacements. This is breaking news for us and the information released by Diamond Foods is very disappointing. Pringles remains a valuable asset and it has attracted considerable interest from other outside parties. We need to evaluate next steps and we are currently keeping all our options open. As we evaluate the right next steps, we will be guided by what is best for our shareholders and our employees.” Shares of Diamond Foods, Inc. are trading 36.25% lower today.

PepsiCo, Inc. (NYSE:PEP): “As we implement our strategic priorities in 2012, we’ve had to make some tough decisions,” said CFO Hugh Johnston. “As a result, 2012 will be a year of transition, one in which we will make the right investments to position PepsiCo properly to achieve long-term high-single-digit core constant currency EPS growth.” For 2012, the Company is targeting mid-single-digit core constant currency net revenue growth, in-line with its long-term target. It expects a decline in core constant currency EPS of approximately 5 percent from its fiscal 2011 core EPS of $4.40, reflecting a combination of strategic and macroeconomic factors. In 2012, the Company will step-up its strategic brand investments by $500-$600 million, particularly in North American beverages and food — the benefits from which will be increasingly seen in the second half of 2012 and into 2013. Further, the Company anticipates a larger increase in consumer-facing spending through marketing efficiency initiatives. Additionally, incremental investments in routes and display racks will total about $100 million in 2012. The Company anticipates a second consecutive year of global commodity cost inflation that is well above historic levels. In a different economic climate the Company would likely offset these additional costs through increased pricing. However, it does not anticipate that it can pass through all of the higher commodity costs to its consumers in 2012 given the continuing challenges that consumers are facing, particularly in the developed economies. Additionally, the Company expects higher pension costs as a result of a lower discount rate, higher net interest expense as it increases indebtedness and also terms-out debt in a low interest rate environment, and a core tax rate of approximately 27%, about 50 basis points higher than in 2011. Partially offsetting these additional costs, major productivity initiatives are expected to result in about a $500 million incremental reduction in operating expenses in 2012. Shares of PepsiCo, Inc. are trading 4.21% lower today.

CAESARS ENTERTAINMENT INC (NASDAQ:CZR): Caesars Entertainment priced 1.8M shares at $9.00. Credit Suisse (NYSE:CS) and Citigroup (NYSE:C) acted as joint book running managers for the offering. Shares of CAESARS ENTERTAINMENT INC are trading 10.18% higher today.

Oracle, Toyota, Alcoa, Nokia Attracting Investor Interest Feb. 9th

Oracle (NASDAQ:ORCL): Oracle announced that it has entered into an agreement to acquire Taleo Corporation or $46 per share, approximately $1.9 billion, net of Taleo’s cash and debt. Taleo’s Talent Management Cloud helps organizations attract, develop, motivate and retain human capital to improve performance and drive growth. Shares of Oracle are trading 0.28% lower today.

Toyota Motor Corporation (NYSE:TM): General Motors (NYSE:GM), Ford Motor (NYSE:F), Tata Motors (NYSE:TTM) and others are trying to wedge their way into the Indonesian car market, which has been dominated by Toyota Motor (NYSE:TM) and other Japanese auto makers for decades, The WSJ reports.

GM, Ford, Tata etc have plans for new plants, new models or new dealerships, in an attempt to capture a share of the emerging middle class in Indonesia. Shares of Toyota Motor Corporation are trading 0.47% higher today.

Alcoa (NYSE:AA): Alcoa is expected to examine the viability of its Point Henry aluminum smelter in Victoria, as higher metal prices, input costs and exchange rates have made it unprofitable, the Daily Telegraph reports. The plant employs 600 people and the review should be completed by the end of June. Shares of Alcoa are trading 0.19% lower today.

Nokia (NYSE:NOK): Nokia has announced planned changes at its factories in Komarom, Hungary, Reynosa, Mexico and Salo, Finland. The measures follow a review of smartphone manufacturing operations that Nokia announced last September and aim to increase the company’s competitiveness in the diverse global mobile device market. These three factories are planned to focus on smartphone product customization, serving customers mainly in Europe and the Americas. Device assembly is expected to be transferred to Nokia factories in Asia, where the majority of component suppliers are based. As a consequence of the plans, the number of steps in manufacturing and the amount of work carried out at the sites in Komarom, Reynosa and Salo are expected to decrease substantially. The changes are anticipated to impact approximately 4,000 employees in total. Personnel reductions are planned to be phased through the end of 2012. Nokia will offer a comprehensive locally-tailored support program, including financial support and assistance with local re-employment. Shares of Nokia are trading 1.92% lower today.

Market Recap: Stocks Gain as Greece Makes Progress

Markets closed up on Wall Street today: Dow +0.05%, S&P +0.15%, Nasdaq +0.39%, Oil +1.04%, Gold +0.03%.

On the commodities front, Oil (NYSE:USO) rose to $99.74 a barrel. Precious metals were also up, with Gold (NYSE:GLD) rising to $1,731.80 an ounce while Silver (NYSE:SLV) rose 0.49% to settle at $33.87.

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Today’s markets were up because:

1) Unemployment. New applications for jobless benefits fell by 15,000 in the week ended February 4, Labor Department figures showed today in Washington, continuing a fairly consistent downward trend that has brought down the four-week moving average to 366,250, the lowest since the week ended April 26, 2008. Initial jobless claims reflect weekly firings, and their decline demonstrates an easing of dismissals that correlates with the drop in the unemployment rate, which fell in January to a three-year low of 8.3 percent.

2) Banks. Bank stocks were trading mixed today, taming what might have been a more vigorous rally, after five of the nation’s biggest banks — Bank of America (NYSE:BAC), JPMorgan (NYSE:JPM), Wells Fargo (NYSE:WFC), Citigroup (NYSE:C), and Ally Financial — agreed to a $25 billion mortgage settlement. Bank of America managed to claw its way to gains of around 0.6 percent, but the other three publicly-traded banks involved in the settlement spent most of the day in the red.

3) Greece. It would be impossible not to mention Greece at all, given that negotiations finally gave way to some weighty developments today, with party leaders (finally) reaching an agreement on austerity measures and reforms. Though a deal has long been expected, any lingering doubts that the country would be able to secure more bailout funds and avoid a default have been assuaged, at least for the moment.

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11 Hot Equities: LinkedIn Surges 6%, Zynga Teams Up With Hasbro and True Religion Crashes 22%

Shares of Activision Blizzard (NASDAQ:ATVI) bounced 1.2 percent higher after announcing fourth quarter earnings.  The company earned 62 cents per share, compared to 53 cents per share a year earlier.  The video game publisher also raised its dividend from 16.5 cents to 18 cents.  Electronic Arts (NASDAQ:EA) also traded higher in late trading.

LinkedIn Corp. (NYSE:LNKD) shares surged more than 6 percent in after the closing bell.  The social network company reported net income of $6.9 million (6 cents per share) for the fourth quarter.  This represents a 30 percent increase from the prior year.  Shares of social gaming company Zynga Inc. (NASDAQ:ZNGA) also edged higher after announcing a partnership with Hasbro Inc. (NYSE:HAS).

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True Religion Apparel Inc. (NASDAQ:TRLG) plummeted 22 percent after releasing fourth quarter results.  The company reported earnings of 62 cents per share, compared to estimates of 71 cents per share.

Shares of Nuance Communications Inc. (NASDAQ:NUAN) fell 10 percent in extended trading.  The company, which is the supplier for Apple’s (NASDAQ:AAPL) Siri speech recognition feature, posted earnings of 34 cents per share, below estimates of 36 cents per share.  For the full year, the company sees non-GAAP revenue of $1.66 billion to $1.71 billion; consensus was $1.68 billion.

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Shares of Expedia Inc. (NASDAQ:EXPE) declined more than 5 percent after releasing fourth quarter results.  Net income for the lodging company fell to $70.3 million (51 cents per share), compared to $71.3 million (50 cents per share) a year earlier.  Shares of Orbitz Worldwide Inc. (NYSE:OWW) and Priceline.com Inc. (NASDAQ:PCLN) also declined.

To contact the reporter on this story: Lindsey Grossman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com