Top 10 for 10/22 - 10/26: DuPont Rattles Markets; iPhone Issue Hits Apple Result; U.S. Q3 GDP Up on Spending; Facebook Finds the Light

October 26, 2012 4:54 PM EDT Send to a Friend
1. DuPont (NYSE: DD) reported third-quarter results that missed the boat and said it will be taking measures to trim costs moving forward.

Sales fell 9.2 percent to $7.39 billion, from $8.14 billion last year. Net income markedly dropped from $452 million down to just $10 million, or 1 cent per share. Excluding significant items like currency adjustments and variable costs, third-quarter EPS was more robust at 32 cents per share.

DuPont said its restructuring plan aims to deliver about $450 million of pre-tax savings. About 1,500 jobs will be eliminated via the new plan over the next 12 months to 18 months.

Shares of DuPont ended up closing down over 8 percent for the week.

2. Apple (Nasdaq: AAPL) missed fiscal fourth-quarter expectations on Thursday, reporting EPS of $8.67 on sales of $36 billion, versus consensus EPS estimates of $8.75 and revs of $35.8 billion. iPhone sales in the quarter were 26.9 million, good by most accounts, but a little shy of expectations. For more color on the results, click here.

For an analyst rundown on the numbers, click here.

3. The preliminary reading for third-quarter GDP showed improvement from the prior period, as consumer spending grew on increased expectations. According to the U.S. Bureau of Economic Analysis, third-quarter 2012 GDP rose 2.0 percent, up from a 1.3 percent pop the preceding quarter. Estimates pegged growth at about 1.8 percent.

In its release, the U.S. BEA commented, "It is difficult for the domestic economy to grow any more robustly, given the relatively soft pace of consumption and investment, weak sentiment among businesses, continued austerity for state and local government spending, weak exports, and the looming "fiscal cliff." Moreover, the negative headwinds from Europe and Asia look to be more persistent than previously thought. On the plus side, housing is finally turning into a positive factor after a long decline."

4. Facebook (Nasdaq: FB) reported quarterly results for its second time since going public in last May. Third-quarter results saw the social networking giant with EPS of 12 cents and revs of $1.26 billion, beating views calling for EPS of 11 cents and revs of $1.23 billion.

Monthly active users climbed to 1.01 billion, and daily active users of 584 million on average in September. This was an increase of 26 percent and 28 percent, respectively.

Shares ended the week 15.5 percent higher.

5. Target (NYSE: TGT) said it entered an agreement to sell its entire consumer credit card portfolio to TD Bank Group (NYSE: TD) for an amount equal to the gross value of the outstanding receivables at the time of closing. Target’s portfolio currently has a gross value of approximately $5.9 billion.

Aside from the agreement, the two entered into a seven-year program agreement under which TD will underwrite, fund and own future Target Credit Card and Target Visa receivables in the United States.

6. Bricks and mortar retailer Best Buy (NYSE: BBY) said it expects fiscal third quarter adjusted (non-GAAP) earnings per diluted share will be significantly below the prior-year period. The news comes as Best Buy is girding to compete with e-commerce retailers on price into the holiday season.

In addition, Best Buy also announced that effective January 1, 2013, Best Buy`s operations in the U.S. will be structured around the following groups: Two Channels - Online and Retail: While online continues to be overseen by Stephen Gillett, president of Digital and Marketing, Shawn Score is appointed to lead the U.S. retail channel; Three Business Groups - Connectivity, Home and Services: Jude Buckley is promoted to head the Connectivity Business Group, succeeding Shawn Score, while Home and Services will continue to be led respectively by Mike Mohan and George Sherman.

7. Monster Beverage Corporation (Nasdaq: MNST) was hit this week following reports that the FDA said it received several incident reports tying the popular energy drink to possible deaths. The FDA noted that incident filings don't link Monster and the health problems, just like when filings are made for drugs.

Aiming to defend itself, Monster issued a response to the filings this week as well, saying that "[n]either the science nor the facts support the allegations that have been made."

8. There was a slew of notable earnings reported this week. Here's a few of the more notable ones:
  • Oshkosh (NYSE: OSK) reported Q4 EPS of $0.65, $0.20 better than the analyst estimate of $0.45. Revenue for the quarter came in at $2.06 billion versus the consensus estimate of $1.98 billion.
  • Merck & Co., Inc. (NYSE: MRK) reported Q3 EPS of $0.95, $0.03 better than the analyst estimate of $0.92. Revenue for the quarter came in at $11.5 billion versus the consensus estimate of $11.6 billion.
  • Amazon.com, Inc. (Nasdaq: AMZN) reported Q3 EPS of ($0.60), $0.52 worse than the analyst estimate of ($0.08). Revenue for the quarter came in at $13.81 billion versus the consensus estimate of $13.92 billion. The loss includes a 37 cent charge.
  • Procter & Gamble Co. (NYSE: PG) reported Q1 EPS of $0.96, in-line with the analyst estimate of $0.96. Revenue for the quarter came in at $20.7 billion versus the consensus estimate of $20.7 billion.
  • F5 Networks, Inc. (NASDAQ: FFIV) reported Q4 EPS of $1.12, $0.06 worse than the analyst estimate of $1.18. Revenue for the quarter came in at $362.6 million versus the consensus estimate of $365.92 million.
  • Zynga (Nasdaq: ZNGA) reported Q3 EPS of $0.00, $0.01 better than the analyst estimate of ($0.01). Revenue for the quarter came in at $316.6 million versus prior view of $300-$305 million.
  • Boeing Co. (NYSE: BA) reported Q3 EPS of $1.35, $0.24 better than the analyst estimate of $1.11. Revenue for the quarter came in at $20 billion versus the consensus estimate of $20.24 billion.
  • Netflix, Inc. (Nasdaq: NFLX) reported Q3 EPS of $0.13, $0.09 better than the analyst estimate of $0.04. Revenue for the quarter came in at $905 million versus the consensus estimate of $905.1 million.
  • Caterpillar, Inc. (NYSE: CAT) reported Q3 EPS of $2.54, 30 cents better than the analyst estimate of $2.24. Revenue for the quarter came in at $15.72 billion versus the consensus estimate of $16.89 billion.
  • Yahoo, Inc. (Nasdaq: YHOO) reported Q3 EPS of $0.35, $0.09 better than the analyst estimate of $0.26. Revenue for the quarter came in at $1.09 billion versus the consensus estimate of $1.08 billion.

9. Ford Motor Company (NYSE: F) announced further details of its plan to achieve profitable growth in its European operations through an unprecedented focus on new products, a strong brand and increased cost efficiencies. The company said that planned actions will reduce installed vehicle assembly capacity, excluding Russia, by 18 percent or 355,000 units. The related gross annual savings total $450 million to $500 million.

Ford projects a loss for Ford Europe exceeding $1.5 billion in FY12 and expects to return the region to profitability by the middle of the decade.

10. IAC/InterActive (Nasdaq: IACI) took a mid-week tumble following misrepresentations of certain forecast non-GAAP measures for its Media & Other reporting segments for 2013 on an 8-K filed this week. IAC placed the blame on StreetAccount, a financial information and analytics service provided by FactSet (NYSE: FDS).

IAC pointed out this error during its earnings call, and FactSet has since corrected its initial reporting; however, before the correction was issued, IAC's stock price declined in trading on NASDAQ, and trading in the stock was temporarily halted.


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