Ultimate Market Recap: Williams Sonoma’s Really Cooking, Gold and Silver Shine
BUZZ Pre-Bell: Dell DROPS, Williams Sonoma Surges 8%
Shares of Dell (NASDAQ:DELL) dropped 5.75 percent in early morning hours. The computer company announced disappointing financial results for the second quarter. Net income fell 17.8 percent to $732 million (42 cents per share), compared to $890 million (48 cents per share) a year earlier. Revenue also declined 7.5 percent to $14.48 billion, falling shy of the average analyst estimate of $14.92 billion. Hewlett-Packard (NYSE:HPQ) shares also fell 1.76 percent on the news.
Williams Sonoma (NYSE:WSM) shares surged 8.82 percent after reporting second quarter financial results. Net income rose 10.4 percent to $43.4 million (43 cents per share), compared to $39.3 million (37 cents per share) a year earlier. Laura Alber, president and chief executive officer commented, “During the quarter, we delivered strong performance in revenues, operating margin and earnings per share. Diluted EPS grew 16 percent on revenue growth of 7 percent, with comparable brand revenue growth accelerating from 5.4 percent in Q1 to 7.4 percent in Q2. Importantly, we drove this growth in revenues and earnings while simultaneously investing in our long-term growth initiatives.”
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Despite reaching another new all-time high of $674.88, Apple (NASDAQ:AAPL) shares closed 1.37 percent lower on Tuesday. Yesterday, the tech giant became the most valuable company by market capitalization in history. Today though, Oracle Investment Research downgraded shares to Hold from Buy and cut the company’s price target to $650 from $670. “The hype concerns us,” Oracle’s Laurence Balter wrote in a note to clients. Shares of Apple are ticking higher this morning 44 cents.
Shares of Intuit (NASDAQ:INTU) edge 0.25 percent lower in early morning trading. The company narrowed its fourth quarter loss to $45 million, compared to a loss of $58 million a year earlier. “Fiscal 2012 was another strong year for Intuit, with 10 percent revenue growth and earnings per share growth of 16 percent,” said Brad Smith, Intuit’s president and chief executive officer. “Our results and our outlook reflect the steady strength of our core businesses and Intuit’s resilience in the choppy macroeconomic environment.”
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Wall Street Brief: UPS Still Wants TNT, HP Earnings On Deck, RBS Under Investigation
In a huge sign that China’s declining growth has halted the global mining boom, BHP Billiton (NYSE:BHP) is discontinuing its plans for a $20 billion Olympic Dam cooper project expansion in Australia. It will now consider a “less capital intensive option.” BHP saw its second half profits fall 35 percent to $7.16 billion and now it won’t accept new projects until the middle of next year.
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Dell’s (NASDAQ:DELL) shares fell 4.5 percent in post-market trading after the company reported its fiscal quarter two earnings and warned about future income. Net profit dropped to $732 million from the previous year’s $890 million. Its $0.50 earnings per share beat estimates but its 8 percent revenue decline to $14.48 billion did not meet consensus. Consumer revenue dropped 22 percent as Dell underwent price pressure at the low end but on positive notes, enterprise solutions/services increased 6 percent and servers/networking jumped 14 percent.
Hewlett-Packard Company (NYSE:HPQ) will report earnings after the closing bell on Wednesday. The company is expecting a net loss of up to $8.9 billion. This represents its largest loss in corporate history and comes from a huge write down from its 2008 EDS acquisition and a charge between $1.5 billion to $1.7 billion after job cuts.
Royal Bank of Scotland (NYSE:RBS) is being investigated by the Fed and Department of Justice for potential violations of sanctions against Iran, reported the Financial Times. In 2010, the bank had agreed to pay $500 million in fines for its Dutch unit ABN Amro embargo violations against Libya, Sudan, Cuba and Iran. Germany’s Commerzbank (CRZBY.PK) is also supposedly being investigated for violations of Iran sanctions.
United Parcel Service, Inc. (NYSE:UPS) said on Tuesday its offer period for the company’s public offer of TNT Express NV (TNT.AE) has been extended until November 9 after its initial expiration date of August 31. UPS will confirm the extension in a September 5 regulatory fling.
Facebook TESTING Game Subscriptions and 4 Hot Stocks Turning Heads
Facebook, Inc. (NASDAQ:FB) roll-out earlier in the month of in-game subscriptions may give the company a much needed boost to its game developing partners, mainly Zynga (NASDAQ:ZNGA), reports Business Insider. Shares of Facebook, Inc. are trading 0.33% higher today.
AT&T, Inc. (NYSE:T) hits back at critics regarding its decision to limit the use of FaceTime over its cellular network to users signing up for its shared data plans. In a post on the company’s official public policy blog, AT&T chief privacy officer Bob Quinn states, “The FCC’s net neutrality rules do not regulate the availability to customers of applications that are preloaded on phones. Indeed, the rules do not require that providers make available any preloaded apps. Rather, they address whether customers are able to download apps that compete with our voice or video telephony services. AT&T does not restrict customers from downloading any such lawful applications, and there are several video chat apps available in the various app stores serving particular operating systems.” Shares of AT&T, Inc. are trading 0.27% lower today.
Nokia Corporation (NYSE:NOK): Verizon Wireless (NYSE:VZ) intends to sell a new Nokia phone using Microsoft’s (NASDAQ:MSFT) Windows 8 software this year. This will be the first time it has released a Windows device since May 2011, sources claim and Bloomberg reports. Shares of Nokia Corporation are trading 4.17% higher today.
eBay’s (NASDAQ:EBAY) PayPal unit, which is an online payments service with over 50 million U.S. users, is to expand the acceptance of its brand to “brick-and-mortar” stores across the nation in an agreement with Discover Financial Services. PayPal customers will be allowed to use their accounts at over 7 million merchant locations already accepting Discover beginning in 2013, the companies claimed in a statement made today. Eventually, the arrangement could expand to include international markets, they stated.
Cemex (NYSE:CX) shares increased to an 18-month high on Wednesday due to the news that the Mexican cement maker nears the end of a long-awaited refinancing deal and hopes to sell a minority stake in a Latin American unit.
Williams-Sonoma SPRINGS to Life and 4 Hot Stocks Turning Heads
Sunrise Senior Living (NYSE:SRZ): Health Care REIT Inc. (NYSE:HCN), which is an Ohio-based owner of senior housing and health-care properties, has agreed to acquire Sunrise Senior Living Inc. for $14.50 a share for the expansion of its assisted-living facilities. The deal is a 62 percent premium over yesterday’s closing share price of $8.93. The company has about 58.3 million outstanding shares, which indicates a value of $845 million, according to data compiled by Bloomberg. This reflects a real estate value of nearly $1.9 billion, Toledo-based Health Care REIT stated in a statement today.
Dell Inc. (NASDAQ:DELL) dropped 5.8 percent to $11.63 at 9:43 a.m. in New York, which is the largest decline since May 23. Through yesterday, the stock had lost 16 percent this year. Shares of Dell Inc. are trading 7.21% lower today.
Skechers USA Inc (NYSE:SKX) shares enjoy a halo lift, and options speculators bet on an extended ascension for the shoe concern. In early trading, the stock has seen about 2,100 calls cross the tape, which is about 14 times its average intraday call volume. On the other hand, less than 50 SKX puts have traded so far. Shares of Skechers USA Inc are trading 1.92% higher today.
Toll Brothers Inc (NYSE:TOL) stated that housing is mending, but consumer confidence remains fragile. Shares of Toll Brothers Inc are trading 4.72% higher today.
Williams-Sonoma, Inc. (NYSE:WSM), who is the owner of the brands Pottery Barn and West Elm home-goods chains, showed the most advancement in 17 months following the increase of its full-year earnings forecast. The shares were boosted 9.6 percent to $41.91 at 9:59 a.m. in New York, after it reached $42.35 for the biggest intraday gain since March 2011. Before yesterday, Williams-Sonoma had fallen 0.7 percent this year. Shares of Williams-Sonoma, Inc. are trading 9.89% higher today.
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Afternoon BUZZERS: Dell PLUNGES Nearly 7%, Toll Brothers and Williams Sonoma POP
Shares of Dell (NASDAQ:DELL) dropped 6.77 percent this afternoon. Late Tuesday, the computer company reported disappointing earnings for the second quarter. Net income fell 17.8 percent to $732 million (42 cents per share), compared to $890 million (48 cents per share) a year earlier. Revenue also declined 7.5 percent to $14.48. “We’re transforming our business, not for a quarter or a fiscal year, but to deliver differentiated customer value for the long term,” said Michael Dell, chairman and CEO. “We’re clear on our strategy and we’re building a leading portfolio of solutions to help our customers achieve their goals.” Hewlett-Packard (NYSE:HPQ) shares also fell on the news.
Toll Brothers (NYSE:TOL) shares jumped 3.40 percent this afternoon after reporting better-than-expected results for its third quarter. Net income surged 46.3 percent to $61.6 million (36 cents per share), compared to $42.1 million (25 cents per share) a year earlier. Douglas C. Yearley, chief executive officer, stated: “We are enjoying the most sustained demand we’ve experienced in over five years. In the past three quarters, the values of our signed contracts were up 45 percent, 51 percent and now 66 percent compared to FY 2011. Three weeks into our fourth quarter, our non-binding reservation deposits (a precursor to future contracts) are up 59 percent compared to the same period in FY 2011.
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Williams Sonoma (NYSE:WSM) shares popped 11.29 percent in early afternoon trading. For the company’s second quarter, net income rose 10.4 percent to $43.4 million (43 cents per share), compared to $39.3 million (37 cents per share) a year earlier. Laura Alber, president and chief executive officer commented, “During the quarter, we delivered strong performance in revenues, operating margin and earnings per share. Diluted EPS grew 16 percent on revenue growth of 7 percent, with comparable brand revenue growth accelerating from 5.4 percent in Q1 to 7.4 percent in Q2. Importantly, we drove this growth in revenues and earnings while simultaneously investing in our long-term growth initiatives.”
Shares of American Eagle Outfitters (NYSE:AEO) increased 6.19 percent this afternoon. The clothing retailer announced it meet or beat Wall Street’s estimates for the third quarter. The company believes it earned 37 cents to 38 cents per share from continuing operations, compared to the estimate of 37 cents per share.
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Apple vs. Samsung Jury Deliberates and 4 Hot Stocks Driving the Market
Best Buy Co., Inc.’s (NYSE:BBY) former CEO Richard Schulze has hired a firm to gain investor support to shake up the company’s board, according to the New York Post, citing unnamed sources. Schulze has begun to lose faith in the negotiations for a standstill agreement, and has hired D.F. King & Co. Shares of Best Buy Co., Inc. are trading 0.75% lower today.
Zynga (NYSE:ZNGA): Although Chief Executive Officer Mark Pincus, who controls 50.15 percent of the voting rights for Zynga shares, stated in July that he will never consider a sale, Ironfire Capital LLC claims the biggest developer of games for Facebook Inc. (NASDAQ:FB)’s social network could gain the attention of activist shareholders wanting changes. The $2.26 billion company, which has fallen to $2.97 a share after Q2 earnings that missed analysts’ projections last month, could gain $7.30 a share in a takeover, according to Falcon Point Capital LLC. Needham & Co. claim that Pincus probably would not consider an offer lower than the IPO price of $10.
American Eagle Outfitters (NYSE:AEO) expects to incur an after-tax loss of about $35 million, including $25 million of exit related charges and $10 million of operational costs during the exit period. The post tax loss for Q2 totaled $24 million, or a 12c loss per diluted share, in comparison to an operating loss of $5 million, or a 3c loss per diluted share, last year. The rest of the exit period costs should be incurred during Q3 of fiscal 2012. Shares of American Eagle Outfitters are trading 6.43% higher today.
Bank of America (NYSE:BAC) is to stop selling credit protection services, which were the subject of a class action suit in which customers claimed they were charged without their permission and enrolled through deceptive practices. A $20 million settlement of the lawsuit received preliminary court approval last month but continues to be without final approval. On Tuesday, a bank spokeswoman confirmed Bank of America’s decision to cease the services. The bank did not admit to any wrongdoing in the settlement. Shares of Bank of America are trading 0.31% higher today.
Apple Inc. (NASDAQ:AAPL): The jury in the Apple (NASDAQ:AAPL) versus Samsung (SSNLF.PK) trial should begin deliberations today in the closely followed case which may significantly effect areas throughout the electronics industry, according to the Wall Street Journal. In closing arguments in the court in San Jose, CA., an Apple lawyer stated that Samsung ripped off in only three months what it took years for the company to develop, the unique features of the iPhone. Samsung rejected the allegations and claimed that Apple just took Samsung to court “rather than competing in the marketplace.” Shares of Apple Inc. are trading 1.09% higher today.
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Market Wrap: Fed Saves the Day as Gold GLITTERS
Markets closed mixed on Wall Street today: Dow -0.23%, S&P +0.02%, Nasdaq +0.21%, Oil +0.43%, Gold +0.87%.
On the commodities front, Oil (NYSE:USO) rose to $97.30 a barrel. Precious metals also increased, with Gold (NYSE:GLD) rising to $1,657 an ounce while Silver (NYSE:SLV) rose 0.43% to settle at $29.86.
Here’s your Cheat Sheet to today’s top stock stories:
Verizon (NYSE:VZ) is preparing its staff for something big next month, issuing an all-staff vacation blackout from September 21 until September 30, and speculators believe it’s the next iPhone launch. At this point, a September iPhone launch seems all but certain — after all, it’s been nearly a year since Apple (NASDAQ:AAPL) released the last iteration of its top-selling smartphone, and tech blogs and insider sources have been churning out rumors since March, with the information becoming more credible and more specific as time progressed.
James River Coal Co. (NASDAQ:JRCC) rose a second consecutive day. On Wednesday, shares increased more than 9 percent after Tuesday’s news that a federal court had sent an emissions ruling to the Environmental Protection Agency for a revision.
Williams-Sonoma Inc. (NYSE:WSM) shares jumped 11 percent. With the company’s revived gross margin and strong sales growth, its profit increased 10 percent in the fiscal second quarter. The quarterly results exceeded Wall Street expectations.
Zynga Inc.’s (NASDAQ:ZNGA) shares increased 7.4 percent after J.P. Morgan began coverage on it with a “Market Outperform” rating.
On the downside, Dell Inc.’s (NASDAQ:DELL) shares declined 5.3 percent. After the bell on Tuesday, the company cut its full-year earnings outlook and gave a down revenue outlook for its current quarter.