Tag Archives: Earnings

by | January 23, 2014 · 9:44 am

Netflix up 17,96%

Netflix (NFLX) surged 17,96% in after-hours trading yesterday after reporting better than expected results in their Q4 report. They have a strong gain in new subscribers in the U.S, and we are talking about video-streaming subscribers. They added 2,33 million new U.S video-streaming members and have total of 33,4 million subscribers. With the International subscribers, they now have more than 44 million members.

Netflix say they will continue to grow in Q1 this year, and the forecast is 2,25 million new members in the U.S and 1,6 million new users in overseas markets. They say that they expect to report earnings of 78 cents a share in Q1.

The company reported earnings of $48 million, or 79 cents a share, on $1,18 billion in revenue in Q4, 2013. In Q4, 2012, they reported profit of $8 million, or 13 cents a share, on sales of $945 million. A sales growth of 23,30%. That is a great lift.

Netflix is trading at $333,73, and that is 80 times the 2014 EPS estimate. The stock is overvalued, and fair value is estimated to be $180. Netflix will grow, but they have big competition. Don`t forget the history in this stock. This stock very volatile. So far this year, the stock is down -9,4%.

Just for fun; let`s take a look at their ROA compared with some of their competitors. Have a look at the chart below:

Company Market Cap ROA
Target 37,3 Bill 5
Dish Network`s 25,9 Bill 4
Netflix 19,8 Bill 1,7
Verizone 135,4 Bill 0,9
Amazone 185,2 Bill 0,5
Blockbuster 1,5 Mill -20

It has been a great week so far, with no «noice» from the Fed. No major reports this week, except today. Probably not so good for day traders who trade on these news, but great for the investors, so they can focusing on the stock market, company`s earnings and all the Q4 reports coming out at the moment.

Reports today: Unemployment Claims at 8:30am, Flash Manufacturing PMI at 9:00am, Existing Home Sales at 10:00am, Crude Oil Inventories 11:00am.

Reed Hastings

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication

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by | January 16, 2014 · 2:17 pm

Yelp is up 292,7%

We have witnessed a “social media boom” the last years. The last “social media” stock is Twitter. Other common social media sites is Facebook (FB), LinkedIn (LNKD), Pandora (P), Zynga (ZNGA), Angie`s list (ANGI), and Yelp (YELP).

Many og these stocks have skyrocketed, and to me it is insane. The highest level for Twitter is $73,31, but are now down -16,01% from the top. Most of you are familiar with Twitter, and some of you are probably using it.

The problem with Twitter is that they are not earning money, so how can investors send the stock price up to $73,31? It doesn`t make sense to me, and remind me of the dot-com bubble from the late 90`s.

Most of the companies mentioned above is ridiculously overvalued. Just like Twitter I mentioned. Many of these companies are short candidates if the major markets tend to retreat. Don`t get me wrong. Yelp have made a fortune for many investors around the world. Yelp is a $5 billion customer review website, and the stock is up a whopping 292,7%. Without earning money!

Yelp is one of the stocks that is pumped up with a hype alone. The companies CEO Jeremy Stoppelman sells his option stocks once he can do that. It doesn`t look good when an insider is selling the companies stock like that.

Analysts expect the earning to be $19 cents a share in 2014. That`s down 21% from $24 cents a share. Despite that, the stock price is going up like never before. New estimates for the stock price is $95.

They have never posted a profit and it is doubtful whether Yelp will ever be a profitable company and they are trading for 336 times its 2014 earnings (the average analysts estimates).

Yelp increased its revenues to $136,50 million (from $83,28 million) and their growth rate slowed to 65%. In 2009 their revenue was $25,81. Analyst expect a growth rate of 57% this year and an average of 40% the next 5 years.

News today: Unemployment Claims & Core CPI at 8:30am, TIC Long-Term Purchases at 9:00am, Philly Fed Manufacturing Index at 10:30am, Bernanke Speaks at 11:10am.

Yelp logo

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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by | January 15, 2014 · 1:37 pm

Tesla up 384,9%

The numbers from J.P. Morgan is important because it is a significant indicator of the fundamental performance by the key banking sector. J.P Morgan has exposure in many banking businesses. J.P Morgan reported an earnings per share of $1,30. That`s below the consensus of $1,31.

Wells Fargo was also better than expected. They earned $1 per share i Q4 last year. That`s also a little bit above consensus of $0,98. Total loan and deposits grew and a strong capital position and returns on assets and equity was positive reports. Great!

Yesterdays reports was not that surprising. J.P Morgan and Wells Fargo are the strongest banking institutions. All the positive readings about the retail points out all the positive revisions to Q4 GDP estimates. That`s why the news about non-farm payrolls gave some people headache.

Tesla shares rose 15,7% yesterday after a strong report. The same company is up 384,9% last 12 months. Vice president of sales, Jerome Guillen, said they delivered 6,900 Model S electric sedans in Q4 last year, and that is up 20% since Q3 last year. Wow! Detroit is back!

General Motors Co will start to pay quarterly dividend this March and this is the first time they have paid a dividend to shareholders since May 2008. The payout will cost GM about $1,67 billion a year. Dividend per share will be 30 cents on its common stocks.

The January effect this year have been two different asset classes. In December last year, investors wrote off long-term treasury bonds and gold bullion as lost. You all know about the declining gold prices in 2013. Falling gold prices and improving economic data led to more money into the stock market.

The iShares 20+ Year Treasury Bond ETF (TLT) was down -13,91% last year, while the SPDR Gold shares ETF (GLD) was down -28,33% in 2013. Both seems to have moved up so far in 2014. One of the key factors that the Fed members are watching to determine how fast they will start to taper is the Treasury bonds that have disappointed in the last payrolls data we all got. It is in conflict with the case for a better job outlook.

Bank of America Corporation (BAC) will release its Q4 reports today. The consensus earnings per share forecast is $0,27. That is up 800% since Q4 last year!

News today: PPI & Empire State Manufacturing at 8:30am, Crude Oil Inventories at 10:30am, Beige Book at 2:00pm.

TSLA 15.01.2014

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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by | January 14, 2014 · 2:28 pm

Is this the end of the bull market?

Japan`s Nikkei is down 3,1%, while the broader Topix is down 2,3%. Nikkei is at its lowest since Dec 18, trading at 15,422,40. It is the biggest drop since Aug 7. The Yen rose after a weaker than expected U.S payrolls report.

European stocks are all down so far today. They are all disappointed about the earnings and outlook about profit growth. The S&P 500 slid yesterday 1,3% after a number of companies posted weak earnings or forecasts.

J.P Morgan Chase & Co are reporting earnings today. The report will be for the fiscal Quarter ending Dec 2013. Consensus EPS forecast for the quarter is $1,31. The reported EPS for the same quarter last year was $1,39.

Wells Fargo & Company is also expected to report earnings today. Consensus EPS forecast for the quarter is $0,98. The reported EPS for the same quarter last year was $0,91.

Tomorrow Bank of America Corporation is expected to report earnings, and the consensus EPS forecast for the quarter is £0,27. Last year it was $0,03. We look forward to see the numbers tomorrow.

Other reports: Tesla (TSLA) Feb 19, Nokia (NOK) Jan 23, Facebook (FB) Jan 29, Google (GOOG) Jan 20, Apple (AAPL) Jan 22, and Amazon (AMZN) Feb 04.

Remember: Stock prices follow earnings, but now they all seem to pay more and more for the same penny of earnings. The S&P 500 rose about 20% last 12 months. This cannot continue. When P/E is soar to much you know that we are at the end of a bull market.

The analysts estimated at the end of September last year that S&P 500 companies would grow earnings by 9,6% in Q4, 2013. Now they say it will grow by 6,3%. This a drop of only 3,3%. Usually it is an average of a drop of 5,8%. They are probably too optimistic?

This can be set for a major disappointment. Investors don`t like lower-than-expected profit growth. So, the companies have to deliver, or the stock prices could drop fast.

We know it is an obvious disconnect between the underlying economic data and the companies outlooks and that is a critical factor. The recent GDP report point to an economy that is accelerating. That means more economic activity and that means more sales and profits for the companies!

News today: Retail Sales & Import Prices at 8:30am at Business Inventories at 10:00am.

 Dow 14.01.2014

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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by | January 13, 2014 · 2:26 pm

Earnings reports this week

Gold is up 3,63% so far this year and the precious metal is trading at $1248,5 at the moment. That is a nice bounce off of the $1200 level. It is not so good for the Dow, which is down 33 points after the bad news on friday. The job growth surprised everyone as Nonfarm payrolls rose only 74,000 in December. Some people are shocked. The S&P 500 ended up 11 points. U.S equities finished the week mixed on the news.

Raw-material prices was down 3,2% this year and this is the worst start to a year since 2007. China is the biggest user of everything, from cotton to pork to zinc and the producer prices declined in December for a 22nd straight month, and this is the longest decline since the Asian financial crises in the 1990`s.

Much has been done of the sharp fall in the unemployment rate to 6,7% and this keeps the Fed on course to start the tapering at this months January meeting, which is January 28-29.

The labour participation rate is at a 35 year low, at 62,8%. It is not a positive thing that so many people have stopped looking for work. Are they really gonna start tapering now?

Hedge funds are cutting their bullish commodity wagers now on signs of slowing economic growth in China and surplus supply.

This year started bad with the major indices trading down the first trading days of the year. This bad starts followed by bad news with only 74000 (non-farm) jobs created in December.

The markets is not as strong as we had thought it might be, and we need some good news now to kick-start the markets again. If not we could lose key support lines. A lot of information is coming out this week.

Very important news is coming from retail sales, housing data, the Fed Beige Book, and consumer sentiment. Earnings reports is on the way too. Bank of America (BAC), Goldman Sachs (GS), J.P. Morgan Chase (JPM), as well as general electric (GE), Wells Fargo (WFC) and Intel (INTC) are some of the large amount of earnings data that will be important to the market this week.

We need a solid week to hold onto technical support.

News today: Federal Budget Balance at 2:00pm (forecast 44,3B – previous -135,2B).

SPX 13.01.2014

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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