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VIDEOTicker Shock: Not a Pretty Picture for Kodak; Ford Gets Totaled
Thursday's top stories and stocks with potential to move.
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The wife casually mentioned that Valentine's Day is just around the corner again. (Just another reminder - don’t say I didn’t warn you.)
And don’t come a-knockin’ cause those Asian markets were a-rockin' overnight. Clearly excited to get back to work after the holiday, the Hang Seng was up more than 4%. The Nikkei was up almost 1.8%. European stocks, however, were showing me some red earlier this morning. Here in the US we're currently trading lower.
Here is what I’m looking at this morning:
Starbucks (SBUX):
The coffee chain that in the not-too-distant past had been almost as adept at parting consumers and their money as Moses did the Red Sea, released its first-quarter earnings. The chain turned in non-GAAP EPS of $0.15, which was $0.02 south of the $0.17 a share that analysts were reportedly looking for.
In fairness to Starbucks bulls, the company isn’t sitting idle. Per the release:
“Starbucks has further reduced its fiscal 2009 new company-operated store openings target in the US to 140 new stores from its previous target of 200 new stores. Internationally, the company now plans to open 170 new stores in fiscal 2009, down from the company’s previous expectation to open 270 new stores. Accordingly, capital expenditures for fiscal 2009 are now expected to be approximately $600 million, a $100 million reduction from the company’s previous estimate. The company has also lowered its net new licensed store opening target, and is now expecting to open approximately 125 net new licensed stores in the US and approximately 360 net new licensed stores internationally.”
It also indicated that intends to close about 300 under-performing stores.
But so what?
Look at the scoreboard: They missed the number. Frankly, before I think about bellying up to the coffee bar on this one I’d like to see it string together a few quarters of good numbers and good news. On top of this economic slowdown, it’s being forced to deal with competition from both Dunkin' Donuts and McDonald's (MCD).
Ford (F):
Not so tough after all, huh? The company was out with its fourth-quarter numbers on this fine Thursday morning.
Per Reuters: “Ford reported a loss from continuing operations, excluding 1-time items of $3.27 billion, or $1.37 per share. Analysts on average expected a loss of $1.23 per share, according to Reuters Estimates.”
Not exactly a sweet ride.
However, my eyes were drawn to this line within the release, which was decent news, all things considered: “Based on current planning assumptions, Ford reiterated it has sufficient liquidity to fund its business plan and product investments. Ford said it finished 2008 with $24 billion in available Automotive liquidity, including $13.4 billion in Automotive gross cash.”
Is Ford on its death bed?
No, but it's not quite the picture of health, either. As such, I’d prefer to sit this one out. I don’t think Ford understands and/or is able to deliver what customers want right now.
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