Archive for April, 2022

• Morning News: April 29, 2022
  Eddy Elfenbein, April 29th, 2022 at 7:04 am

  Europe’s Economy Slows to A Crawl as War and Inflation Take a Toll

  U.S. Economy Shrank in First Quarter, but Underlying Measures Were Solid

  Market Volatility, Balance Sheet Surprises Raise Risk of Bumpy Fed Pivot

  Labor Department Criticizes Fidelity’s Plan to Put Bitcoin on 401(k) Menu

  War Is Making One of the Richest Countries Even Richer

  Fracking Boom Turns Texas Into the Earthquake Capital of the U.S.

  The Permian Basin Oil Field Is Running Out of Workers, Materials—and Cash

  Texas Stumbles in Its Effort to Punish Green Financial Firms

  F.D.A. Moves to Ban Sales of Menthol Cigarettes

  Tech Stocks Lose $1.8 Trillion in a Month Thanks to Fed

  Apple Says China Lockdowns Loom Over Sales

  Jeff Bezos Loses $13 Billion in Hours as Amazon Shares Slump

  Elon Musk Offloads $4 Billion of Tesla Shares, Pledges No More Sales

  Inside Twitter, Fears Musk Will Return Platform to Its Early Troubles

  Robinhood Abandoned by Fans of Crypto and Meme Stocks

  McDonald’s Left With Millions Of Dollars Of Russian Food It Can’t Use. Here’s Why.

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• Four Earnings Reports this Morning
  Eddy Elfenbein, April 28th, 2022 at 8:56 am

  There’s a lot of news this morning. Let’s start with FactSet (FDS) which increased its dividend by 8.5% to 89 cents per share. This is the 23rd year in a row that FactSet has raised its dividend.

  Now to earnings. We had four Buy List stocks report this morning.

  Let’s start with Hershey (HSY) which had a big beat. The chocolate company said its earnings rose 31.8% to $2.53 per share. That beat expectations of $2.10 per share. Hershey increased its full-year guidance to a range of $7.91 to $8.05 per share. That’s growth of 10% to 12%. The previous range was 8% to 10%.

  Church & Dwight (CHD) reported Q1 earnings of 83 cents per share. That beat expectations of 77 cents per share. The company had been expecting 75 cents per share. For the year C&D sees earnings growth of 4% which is at the low end of their 4% to 8% range.

  Carrier (CARR) announced earnings of 54 cents per share. Expectations were for 47 cents per share. Carrier also reiterated its full-year guidance of $2.20 to $2.30 per share.

  Thermo Fisher (TMO) earned $7.25 per share compared with estimates of $6.18 per share. On its earnings call, Thermo raised its full year guidance from $22.43 per share to $22.65 per share.

  For economic news this morning. Jobless claims came in at 180,000 which matched expectations. Q1 GDP was -1.4%. The economy shrunk last quarter but a lot of that was due to inventories. Consumption rose by 2.7%.

• Morning News: April 28, 2022
  Eddy Elfenbein, April 28th, 2022 at 7:00 am

  Yen Hits New 20-Year Low After Bank of Japan Reinforces Low-Rate Policy

  Yen’s Historic Fall Signals Rewrite of Global Currency Playbook

  UBS Becomes Third Global Bank to Lose China Boss This Month

  Indonesia Stuns Markets as It Widens Ban to Include CPO, Refined Palm Oil

  Europe Sees Ambiguity in EU’s Advice on Russian Gas Demands

  In the Top U.S. Oil Field, a Battle for Materials Crimps Growth

  The Fed’s Racing to Raise Rates, But How High Remains an Open Bid

  The Revolt of the College-Educated Working Class

  Matt Levine: What Was Bill Hwang Thinking?

  How Vanguard Founder John Bogle Changed Everything

  Elon Musk Already Broke His Agreement with Twitter

  Meta Shares Soar as Facebook Returns to User Growth

  Disney Strategy Is to Stay Silent to Soften Florida Gov. Ron DeSantis’s Blow

  Boeing Looked for Flaws in Its Dreamliner and Couldn’t Stop Finding Them

  Ford Posts $3.1 Billion First-Quarter Loss, Maintains 2022 Outlook

  McDonald’s Leans on Price Hikes to Beat Earnings Estimates

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• Earnings from AFLAC and FICO
  Eddy Elfenbein, April 27th, 2022 at 4:15 pm

  After the closing bell, AFLAC (AFL) reported earnings of $1.42 per share. That was five cents more than estimates. The weaker yen/dollar exchange rate pinged earnings by six cents per share. Total revenues were $5.3 billion in Q1 compared with $5.9 billion last year. AFLAC’s U.S. sales increased by 19.0% to $299 million.

  Commenting on the company’s results, Chairman and Chief Executive Officer Daniel P. Amos stated: “The company generated solid earnings for the first quarter, supported in part by the continuation of low benefit ratios associated with pandemic conditions and better-than-expected returns from alternative investments, despite the weakening yen. We continue to remain cautiously optimistic as we continue to navigate the pandemic.

  “Looking at our operations in Japan, persistency remained strong in the first quarter, but sales were constrained as we continued to operate in the wake of evolving pandemic conditions, including various states of emergency that were in effect through mid-March. These impacted our ability to meet face-to-face with customers, which continues to be key to a recovery in sales. Recognizing pandemic conditions in Japan, we expect stronger sales in the second half of the year assuming that those conditions subside, productivity continues to improve at Japan Post, and we execute on our product introduction and refreshment plans.

  The stock is about flat in after-hours trading.

  FICO (FICO) said it made $4.68 per share for its fiscal Q2. That beat estimates of $3.73 per share. Revenue increased to $357 million.

  “We continue to deliver strong results in an uncertain economic environment,” said Will Lansing, chief executive officer. “We’re delivering strong top-line growth, and our focus on efficiency has enabled us to deliver expanded margins.”

  FICO raised its full-year guidance from $14.12 per share to $16.08 per share. The company has already made $8.36 for the first six months of this year.

  The stock is up 3.3% in after-hours trading.

• Earnings from Fiserv and Silgan
  Eddy Elfenbein, April 27th, 2022 at 11:49 am

  Hectic morning today in the markets. Stocks started off well, then dipped lower and now are back up again. I see that shares of Twitter are down to $48 per share. Perhaps there are some deal doubters out there.

  We had two Buy List earnings report this morning. Fiserv (FISV) earned $1.40 per share. That’s up 20% from last year and it topped Wall Street by five cents. Adjusted revenue grew by 10% to $3.91 billion. Organic revenue growth was up 11%.

  Fiserv stuck by its full-year forecast of $6.40 to $6.55 per share. That works out to growth of 15% to 17%.

  Also this morning, Silgan Holdings (SLGN) said it made 78 cents per share for its Q1. That was two cents more than estimates. Business is going so well that Silgan raised its full-year guidance range to $3.90 to $4.05 per share. The previous range was $3.80 to $4.00 per share. In February, the company bumped up its quarterly dividend from 14 to 16 cents per share.

  AFLAC and FICO will report after the close.

• Morning News: April 27, 2022
  Eddy Elfenbein, April 27th, 2022 at 7:07 am

  Russia Stops Gas to Poland and Bulgaria, Opens New Front in Economic War

  Can Japan Keep the Lights On? The Ukraine War Upends a Big Energy Bet.

  Four European Gas Buyers Made Ruble Payments to Russia

  Oil Exporters Bagging $818 Billion Windfall Are Cautioned by IMF

  Why U.S. Oil Companies Aren’t Riding to Europe’s Rescue

  With Inflation, Gold Notes and Cards Find Their Way into America’s Wallet

  Stock Market Meltdowns Have FAANGs Looking Increasingly Toothless

  Alphabet Earnings Show Slowing Sales Growth on Digital-Ad Tumult

  Facebook Parent Meta Expected to Post Slowest Revenue Growth Since IPO

  Microsoft Earnings Rose Last Quarter With Demand for Cloud Services

  Elon Musk Bets Twitter Users Will Like a More Freewheeling Platform

  Musk Is a Problem Masquerading as a Solution

  Hot Job Market, an Economic Relief, Is a Wall Street Worry

  Deutsche Bank Joins UBS in Flagging Challenge of Soaring Pay

  The 400 Airplanes That Russia Seized Have Become an Epic Insurance Struggle

  The Biden Student Debt Question: Will He or Won’t He?

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• Morning News: April 26, 2022
  Eddy Elfenbein, April 26th, 2022 at 7:08 am

  Nuclear Power Could Help Europe Cut Its Russia Ties, but Not for Years

  Beijing Starts Testing 20 Million to Try to Avoid a Lockdown Like Shanghai’s

  Supply Chain Chaos Roars Back as Covid Grips China

  The $67 Billion Tariff Dodge That’s Undermining U.S. Trade Policy

  Inflation Got You Down? At Least You Don’t Live in Argentina.

  Real Yields Wade Toward Positive Territory, Denting Stocks

  Fidelity to Allow Retirement Savers to Put Bitcoin in 401(k) Accounts

  Senate Tees Up Votes on Biden’s Fed Nominees

  Twitter Takeover Was Brash and Fast, With Musk Calling the Shots

  Twitter Employees Search for Answers as Musk Takeover Becomes Reality

  Musk’s Twitter Deal Heralds Potential Social-Media Shift

  UBS Beats Expectations for the First Quarter; Continues to Reduce Russia Exposure

  Google Investors Warn Saudi Arabia Data Project Could Be Used By ‘Top Hitmen’

  Facebook Is Opening Its First Showroom to Sell VR Headsets

  Ford Hurries Out F-150 Lightning to Grab Share of Electrics Market

  PepsiCo Beats Q1 Profit Forecast, Lifts 2022 Sales Outlook On Snacks Strength

  Times Square Plots Its Comeback, and It Looks Like Las Vegas

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• Your Terms Are Acceptable
  Eddy Elfenbein, April 25th, 2022 at 3:07 pm

  It really happened. Twitter’s board has unanimously accepted Elon Musk’s offer. The stock has been halted. From the NYT:

  Elon Musk struck a deal on Monday to buy Twitter for roughly $44 billion, in a victory by the world’s richest man to take over the influential social network frequented by world leaders, celebrities and cultural trendsetters.

  Twitter agreed to sell itself to Mr. Musk for $54.20 a share, a 38 percent premium over the company’s share price this month before he revealed he was the firm’s single largest shareholder. It would be the largest deal to take a company private — something Mr. Musk has said he will do with Twitter — in at least two decades, according to data compiled by Dealogic.

  “Free speech is the bedrock of a functioning democracy, and Twitter is the digital town square where matters vital to the future of humanity are debated,” Mr. Musk said in a statement announcing the deal. He said he wanted “to make Twitter better than ever.”

  Wow. I didn’t think it was really going to happen. There’s no getting around the fact that Twitter simply isn’t that profitable. The company is due to report earnings on Thursday. Wall Street had been expecting earnings of three cents per share.

• Otis Earns 77 Cents per Share
  Eddy Elfenbein, April 25th, 2022 at 9:39 am

  We had more good earnings news this morning. Otis Worldwide (OTIS) reported Q1 earnings of 77 cents per share. That was up 6.9% over last year and it was three cents more than expectations. Organic sales rose 3.1% to $3.4 billion.

  The quarter was even stronger than it may appear. Q1 cash flow from operations was $504 million. Free cash flow was $474 million, or 152% of net income.

  “Otis delivered a strong first quarter with broad based growth in New Equipment orders and maintenance portfolio units, nearly 6% Service organic sales growth, 30 basis points of Otis adjusted margin expansion and high-single digit adjusted EPS growth. In addition, year-to-date, we have made progress on our capital allocation strategy by successfully increasing our ownership in Zardoya Otis that will result in its automatic delisting in early May, repaying $500 million of debt and returning cash to shareholders through $200 million in share repurchases and a more than 20% increase in our dividend,” said Judy Marks, Chair, CEO & President. “These achievements, and the progress we are making on our ESG initiatives, demonstrate the strength of our strategy, our ability to execute and the resilience of our business. Looking ahead, despite the intensifying macro challenges, including the impact from the crisis in Ukraine, we expect to achieve 3 to 4% organic sales growth and 10% adjusted EPS growth, at the midpoint.”

  During the quarter, Otis bought back $200 million of stock and repaid $500 million of debt. Otis’s operating profit expanded from 22.4% to 22.9%.

  Otis also revised its full-year outlook, excluding business in Russia. The company now expects sales of $14.1 to $14.3 billion and EPS of $3.22 to $3.27. The previous range was $3.20 to $3.30 per share.

  The stock has been as high as 3.5% today.

• Morning News: April 25, 2022
  Eddy Elfenbein, April 25th, 2022 at 7:01 am

  Ukraine’s Grim Economic Toll From War Confronts World Governments

  Russia’s War Is Bringing the Dirtiest Fuel Back from the Dead

  Gas-Engine Bans Drive Landscapers Toward Electric Mowers and Blowers

  Oil Sinks Below $98 as China’s Lockdowns Imperil Demand Outlook

  Warren Buffett Faces Renewed Climate Change Challenge by Investors

  Indonesia’s Palm Oil Export Ban Leaves Global Buyers With No Plan B

  Covid Outbreak in Beijing Prompts Panic Buying and Lockdown Fears

  Covid Lockdowns Revive the Ghosts of a Planned Economy

  Global Auditing Firms Struggle to Leave Russia

  The Fed Wants to Raise Rates Quickly, but May Not Know Where to Stop

  U.S. Trucking Downturn Foreshadows Possible Economic Gloom

  Some Job-Switchers Are Having Second Thoughts

  Crypto Industry Can’t Hire Enough Lawyers

  Twitter Warms to Elon Musk’s $43 Billion Takeover as Talks Proceed

  Inside the Implosion of CNN+

  Coca-Cola Earnings Beat Wall Street Estimates As Revenue Jumps 16%

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