Ticker Shock: Apple Looking Shiny, Yahoo and Broadcom Pleasant Surprises
Wednesday's top stories and stocks with potential to move.
Asia got walloped as we slept. In fact, the Nikkei was down more than 6%. Europe is in the red.
But hey, at the time of this writing, oil is below $70 a barrel. You gotta be an optimist these days, right?
Anyway, we are off to a lower open this morning.
After the close on Tuesday, Apple reported a fourth-quarter profit of roughly $1.14 billion or $0.26 per share. Meanwhile, its revenue line came in at approximately $7.9 billion. That's a beautiful jump over the $1.01 a share and the roughly $6.22 billion in revenues it generated in the same period last year.
Folks, that EPS number was way north of the $1.11 per share analysts had been looking for. This, my friends, may be just what the doctor ordered. Finally, some good news, after the sheer pummeling the stock has been taking lately.
However, Apple's CFO, Peter Oppenheimer, offered only "prudent" expectations for the remainder of the quarter, with earnings of $1.06 to $1.35 per share and sales from $9 billion to $10 billion.
Not great, given the fact that the Street was reportedly looking for $1.65 a share and a smidge over $10.5 billion in revenue.
But I think the company's first-quarter estimates may be on the conservative side, and that it'll beat those expectations. In short, I think the stock rocks today, and will soon be enjoying triple digits again.
After the close yesterday, Yahoo disseminated its third-quarter numbers, with earnings of $0.04 per share. Not counting items, earnings were approximately $0.09 per share, which was essentially in-line with expectations.
Also on the plus side of the equation, management said it's cutting approximately 10% of its workforce. Not good news, obviously, for Yahoo's employees, but encouraging for shareholders, to whom it may demonstrate that Mr. Yang is getting serious about saving money and enhancing shareholder value.
However, there are other negatives: Yahoo offered fourth-quarter gross-revenue guidance of $1.77 billion and $1.97 billion - a 3% decline from the $1.83 billion in revenue it posted in the comparable period last year.
My take: Given the way the market looks today, I think the stock could take a hit. That being said, I do think this stock will move higher in 2009, and that we're nearing a decent entry point. On that note, another thing that caught my eye was some insider activity back in the latter part of August.
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