We have told investors and traders worldwide what it would take the start the rally and this here has to stop and bottom out for the markets to look forward as they have no clarity and therefore the selling keeps up.
We are going to be teach people how this works going forward in our SMF Economic Club you can sign up now by sending an email to info@stockmarketfunding.com or by calling us today at 702-685-0772 we will be happy to update you so that you can start planning your futures moving forward.
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SMF NOTES Reports Q4 (Dec) earnings of $1.07 per share, may not be comparable to the First Call consensus of $0.61; revenues rose 25.6% year/year to $2.14 bln vs the $1.91 bln consensus. Note, the $1.07 excludes a $0.17 charge in connection with final purchase price allocation adjustments regarding beginning inventory values related to its Aug 2008 acquisition of PNA Group. It's not clear if this is included in consensus, but either way, it's a large beat. Co says that starting primarily in November and December, it experienced sudden declines in demand and accelerated mill pricing reductions that resulted in significant competitive pressures and deteriorating profit margins as metals service centers, including Reliance, focused on inventory destocking. As a result, Q4 was very difficult. Co has not seen any meaningful change in business activity levels so far in 2009. Pricing for most all of its products seems to be at or near the bottom but there is still intense competitive pressure in the marketplace as metals service centers continue to adjust inventory levels downward to better align them with demand.
Prepare yourself for the "New Economy"
We have told investors and traders worldwide what it would take the start the rally and this here has to stop and bottom out for the markets to look forward as they have no clarity and therefore the selling keeps up.
We are going to be teach people how this works going forward in our SMF Economic Club you can sign up now by sending an email to info@stockmarketfunding.com or by calling us today at 702-685-0772 we will be happy to update you so that you can start planning your futures moving forward.
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SMF NOTES Credit Suisse notes last night, while HPQ's Q1 EPS of $0.93 came in line with consensus expectations, revenues of $28.8 bln missed their est of $32.08 bln by a surprisingly wide margin. Printer consumables sales fell sharply, but a steep deterioration in hardware sales (negative margin) countered the profit impact.
If hardware continues to decline at close to 40% a year, margins could hold, though the installed base and future consumables sales would be impaired. But if hardware declines moderate, then consumables weakness could trigger a sharp margin contraction. Firm is assuming the latter scenario unfolds. Aggressive hardware price declines contributed to a 300 basis point shortfall in ESS margins versus firm's est. For FY09, firm is looking for EPS of $3.36 vs guidance of $3.76-3.88. They are also lowering their tgt to $30 from $35...
Kaufman notes strong recessionary headwinds finally took a toll on HPQ causing the co to report a January qtr revenue miss and revenue guidedown much worse than lowered expectations. However, its EPS results and guidance were in line with consensus due to favorable product mix toward software (3%) and printer supplies (14%) as well as cost improvements with its integration of EDS.
Firm believes this is the first material rev miss under CEO Mark Hurd's leadership since early 2005, indicating that this recession is putting a test even on strong cos, making peers AAPL and IBM's results and commentary appear even more impressive, in their view...
Collins Stewart notes the key takeaway from HPQ's call is IT spending continues to deteriorate as reflected in the big rev miss during 1Q and for the remainder of FY09. Both Benchmark (BHE) and Celestica (CLS) hold the highest exposure to enterprise hardware spending in their universe, which they expect to remain challenging.
Benchmark generated 46% of 4Q08 sales from the high-end computing market (e.g., servers, storage-related products), while Celestica generated 44% of 4Q08 sales from enterprise hardware markets (22% from enterprise communications, 13% from servers/mainframes and 9% from storage).
HPQ specifically highlighted a slowdown in server demand in January as "customers re-evaluated their spending and delayed purchases of equipment".
Prepare yourself for the "New Economy"
We have told investors and traders worldwide what it would take the start the rally and this here has to stop and bottom out for the markets to look forward as they have no clarity and therefore the selling keeps up.
We are going to be teach people how this works going forward in our SMF Economic Club you can sign up now by sending an email to info@stockmarketfunding.com or by calling us today at 702-685-0772 we will be happy to update you so that you can start planning your futures moving forward.
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SMF NOTES Reports Q4 (Dec) earnings of $0.72 per share, in-line with the First Call consensus of $0.72; revenues rose 43.1% year/year to $84.3 mln vs the $81.9 mln consensus. Co attributes increase in revenues to an increase in prevailing time charter rates and the increase in operating days due to the enlargement of the Company's fleet. "In a challenging economic environment, Diana Shipping achieved solid growth in revenues and earnings for the fourth quarter and full year 2008. While business conditions remain unsettled, we are well-positioned to operate our business successfully and to seize upon opportunities that may emerge in the coming year. We have cultivated and expanded our relationships with some of the strongest charterers in the industry. Our balance sheet is healthy and not over-leveraged. And our young, efficient fleet provides a significant competitive advantage. We believe the current dislocations in the dry bulk marketplace will offer many opportunities for companies with good revenue visibility, strong capital and liquidity, and management teams with a disciplined approach to managing risk and creating value. We fully intend to take advantage of those opportunities for the long-term benefit of our shareholders."
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SMF NOTES Co issues downside guidance for FY09, sees EPS of $4.40-$4.50 vs $4.69 First Call consensus. This includes expectations for EPS growth in Q2 and Q3 to both be in the 10-12% range.
Co states, "The determined focus of Monsanto to successfully execute its industry-leading seeds and traits strategy is the key to helping the company achieve 20 percent-plus earnings growth and generate more than $1.8 bln in free cash for fiscal 2009.
It also will more than offset any anticipated decline in the company's Roundup herbicide business over the next three years and move the company closer to reaching its goal of more than doubling its fiscal 2007 gross profit by 2012...
The anticipated ongoing success of the company's seeds and traits businesses will more than offset the expected decline in its Roundup herbicide business to the $1.9 billion gross profit level by 2012... 2009 will likely be the peak of Roundup profitability, which is expected to be in the $2.4-$2.5 bln gross profit range as he expects current pricing based on added value to more than offset volume declines...'
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Baird maintains their Neutral rating following CSCO's in-line FQ2 results and guidance well below expectations last night (down 15% - 20% YoY versus firm's est down 14% and Street down 11%). Deterioration in order rates accelerated through January with no sign of stabilization, which drove further reductions in Cisco's outlook and bodes poorly for the entire networking space. Operating margin is compressing rapidly despite cost cutting initiatives. Firm remains on the sidelines as they feel a
coordinated global recovery across many market segments is required to stabilize Cisco's fundamentals. Implications are negative for other networking cos as Cisco was the first to report January results, revealing continued deterioration in trends. They see incremental risk to the outlook for other networking companies, particularly those exposed to Service Provider, which deteriorated fastest relative to Cisco's expectations.
Jefferies notes with a global recession underway, demand for networking equipment is deteriorating. In their view, Cisco is trying its best to contain costs without implementing a major layoff and preparing for a market recovery. However, if the environment worsens, they believe they are prepared to take further action. They prefer Cisco's solid balance sheet, market leadership and diversified exposure.
Firm maintains Buy and lowers their tgt to $18 from $19... Credit Suisse maintains their Neutral rating and see shares remaining range-bound, with a downward bias, until rev growth rates stabilize and begin to expand. Until firm has visibility as to macro-economic recovery, they see EPS forecasts remaining subject to downward revisions and low confidence levels and do not see a catalyst to drive sustained share appreciation.
FY3Q09 guidance and commentary supports their view that the magnitude of the impact of the global macro-economic downturn has not been fully discounted by the Street. They believe the key variable, going forward, will be gross margin as they expect CSCO to scale opex reductions based on scope of rev decline and timing of rebound. Firm also cut their tgt to $15 from $16.
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