24/7 Wall St. » TXN

Nvidia Jumps on Results, Forecast (NVDA, ARMH, QCOM, AAPL, TXN, MSFT, INTC, AMD)

Paul Ausick — Fri, 11 May 2012 13:04:15 +0000

Chip maker Nvidia Corp. (NASDAQ: NVDA) handily beat consensus estimates for first quarter revenues and EPS the company reported this morning. Revenue totaled $924.9 million compared with an estimate of $916.2 million and adjusted EPS came in at $0.16 versus an estimate of $0.10.

The company’s CEO could barely contain his enthusiasm:

Kepler GPUs [graphics processing units] are accelerating our business. Our newly launched desktop products are winning some of the best reviews we’ve ever had. Notebook GPUs had a record quarter. And Tegra is on a growth track again, driven by great mobile device wins and the upcoming Windows on ARM launch.

Nvidia, which licenses designs from ARM Holdings plc (NASDAQ: ARMH), may be getting back on track following a couple of weak quarters. Like other ARM licensees such as Qualcomm Corp. (NASDAQ: QCOM), Apple Inc. (NASDAQ: AAPL), and Texas Instruments Inc. (NASDAQ: TXN), Nvidia is profiting from the explosive demand for mobile devices like smartphones and tablets.

The company’s growth prospects are further enhanced by a decision from Microsoft Corp. (NASDAQ: MSFT) to release a version of is Windows 8 operating system for ARM-based processors, the company’s first foray from the x86-designs of Intel Corp. (NASDAQ: INTC) and Advanced Micro Devices Inc. (NYSE: AMD).

Nvidia forecast second quarter revenue of $990 million to $1.05 billion, significantly above the current consensus estimate of $976.2 million. Non-GAAP gross margins are also expected to rise from 50.1% in the first quarter to 51.5% in the second quarter.

The company’s share price is down about -45% since the beginning of 2011. Nvidia’s forward P/E ratio in February of 2011 was north of 63. That has fallen to 13.65 today, indicating an abundance of enthusiasm from investors that the company simply couldn’t deliver on. The situation is changing now, and Nvidia might actually be set to deliver the goods.

Shares are up 9.5% in the pre-market this morning, at $13.58 in a 52-week range of $11.47-$20.52.

Paul Ausick

Filed under: Consumer Electronics, Earnings, Industry, Pre-Market Activity, Semiconductor, Semiconductors, Technology Tagged: AAPL, AMD, ARMH, featured, INTC, MSFT, NVDA, QCOM, TXN

Top Analyst Upgrades & Downgrades (ALSN, AZO, BIG, CHKP, CMG, CTRN, DWRE, GE, ILMN, LNKD, PBY, RMBS, TXN, UNH, XRX)

Administrator — Tue, 24 Apr 2012 12:04:35 +0000

These are some of the top analyst upgrades, downgrades and initiations seen in Wall Street research calls this Tuesday.

Allison Transmission Holdings, Inc. (NYSE: ALSN) Started as Neutral at Credit Suisse; Started as Neutral at Goldman Sachs; Started as Neutral at Citigroup.

AutoZone Inc. (NYSE: AZO) Raised to Overweight at JPMorgan.

Big Lots Inc. (NYSE: BIG) Cut to Hold at Deutsche Bank.

Check Point Software Technologies Ltd. (NASDAQ: CHKP) Maintained Hold at Argus.

Chipotle Mexican Grill, Inc. (NYSE: CMG) Cut to Neutral on valuation at Credit Suisse; Reiterated Buy with $480 target at Argus.

Citi Trends, Inc. (NASDAQ: CTRN) named Bear of the Day at Zacks.

Demandware, Inc. (NYSE: DWRE) Started as Buy at Deutsche Bank; Started as Outperform at William Blair; Started as Outperform at Oppenheimer; Started as Neutral at Goldman Sachs.

General Electric Co. (NYSE: GE) Reiterated Buy with $22 target at Argus.

Illumina, Inc. (NASDAQ: ILMN) Reiterated Buy with $54 target at BofA/ML.

LinkedIn Corporation (NYSE: LNKD) Started as Overweight at Piper Jaffray.

Pep Boys-Manny, Moe & Jack Inc. (NYSE: PBY) Cut to Sell at Argus.

Rambus Inc. (NASDAQ: RMBS) Raised to Overweight at JPMorgan.

Texas Instruments Inc. (NASDAQ: TXN) Reiterated Buy with $36 target at BofA/ML.

UnitedHealth Group (NYSE: UNH) named Bull of the Day at Zacks.

Xerox Corporation (NYSE: XRX) Reiterated Buy with $13 target at Argus.

If you enjoyed the top analyst upgrades and downgrades, you can join our free email newsletter that includes analyst summaries each morning sent right to your inbox. We also cover top issues such as IPOs, special financial exclusives, mergers and more. Sign up in the box below.

JON C. OGG

Filed under: Analyst Calls Tagged: ALSN, AZO, BIG, CHKP, CMG, CTRN, DWRE, GE, ILMN, LNKD, PBY, RMBS, TXN, UNH, XRX

Mobile Chip Maker’s Results Don’t Impress Investors (ARMH, AAPL, QCOM, NVDA, TXN, INTC)

Paul Ausick — Tue, 24 Apr 2012 11:47:16 +0000

UK-based chip designer ARM Holdings PLC (NASDAQ: ARMH) reported earnings earlier today, posting revenue of about $209.4 million, well above estimates of $201.23 million, but below revenues of $217 million in the fourth quarter of 2011. Earnings per ADS totaled $0.13, a penny below the consensus estimate, and it is that miss that is weighing on the share price in the pre-market this morning.

ARMH has other complications as well. The company’s designs are used in a variety of mobile devices, including iPhones and iPads from Apple Inc. (NASDAQ: AAPL) which uses chips manufactured by Qualcomm Corp. (NASDAQ: QCOM). Nvidia Corp. (NASDAQ: NVDA) and Texas Instruments Inc. (NASDAQ: TXN) also use ARM designs. The world’s biggest chip maker, Intel Corp. (NASDAQ: INTC), has not been a major force in the mobile device market, but that is about to change.

Intel launched its ‘Ivy Bridge’ processor family yesterday. The chip uses less power while still offering more computing punch. A version of the chip is scheduled to be released before summer, and that could have an impact on ARM’s business.

And what a business it is. Gross margins for the quarter were 94.4%, the same as they were in the same period a year ago. In the fourth quarter of 2011, gross margins were even higher — 96%.

For the full fiscal year, ARM said it expects “dollar revenues for the full-year 2012 will be in line with current market expectations.” The consensus estimate is $885.2 million.

Given that ARM’s quarterly performance can be characterized as merely ‘okay,’ that the company missed the consensus earnings estimate, that Intel is about to go after ARM’s main market, and that the company’s outlook remains unchanged, it’s no surprise that in the pre-market this morning, ARM ADSes are down more than -3% at $26.70 in a 52-week range of $22.10-$32.18.

Paul Ausick

Filed under: Consumer Electronics, Earnings, Industry, Semiconductors, Technology, Telecom Tagged: AAPL, ARMH, INTC, NVDA, QCOM, TXN

As Employment Surges in Six States, Texas Rules

247wallst — Mon, 23 Apr 2012 10:39:10 +0000

Six states added, in total, 787,000 jobs during the past year, according to government data for March. This makes them the primary engines of national employment growth over that period. Nearly a third of these jobs were added in Texas, which is a sign that its diverse economy and sheer size make it the envy of other large states.

The six states can be divided into two groups. In one is states that had extremely high unemployment over the course of the recession because of the collapse in housing prices and manufacturing. The other states never had high jobless rates and have recovered from the downturn rapidly.

Here is a quick look at these states and the reasons for their job additions. The numbers are based on a comparison of unemployment in March 2011 and March 2012.

6. Michigan added 56,500 jobs over the period, after a savage downturn in its manufacturing sector. Total jobs in the state have reached 3,982,000 as it tries to offset a loss of work in the auto industry with new jobs from smaller businesses, some of which have relocated to the state. Detroit’s jobless rate remains extremely high and will continue to be a drag on state numbers. The unemployment rate in March was down to 8.5% from 10.5% a year earlier.

5. Ohio added 56,900 jobs, which brought its unemployment rate down from 8.8% to 7.5%. That is below the current national average. Ohio now has an employment base of 5,137,000. The harm done by the loss of manufacturing jobs has been partially reversed by increases in the health care and financial sectors.

4. Florida added 89,800 jobs from March 2011 to March 2012. While the Bureau of Labor Statistics reports that the unemployment rate dropped from 10.7% to 9%, it is still well above the national average. Florida has 7,328,700 full-time workers. A decrease in construction work has been offset to some extent by agricultural, financial services and public utilities jobs.

3. New York added 155,300 jobs. Upstate, the manufacturing sector was hurt, which increased unemployment in formerly large cities such as Buffalo, Rochester and Syracuse. But the relative strength of the New York City economy, as well as the modest stability of financial services jobs there, helped keep the economy steady. Unemployment never got terribly high in New York State. Unemployment fell from 8.5% to 8% over the measurement period. Businesses in New York employed 8,804,700 people in March.

2. California’s diverse economy, and its place as the largest state by population, could not keep it from being one of the states hardest hit by the recession. It added 181,000 jobs, a very modest number given its size. In March, the state had 14,237,300 and an unemployment rate of 11%, down from 11.9% a year earlier. Jobs gains in tech barely offset the huge drop in construction jobs and work in the public sector. Unemployment in some of the cities in the central part of the state, which includes Stockton, are still well above 15%.

1. Texas added 245,700 jobs from March to March, and its unemployment rate dropped to 7% from 8%. Texas had a full-time employment level of 10,741,700 in March. Job losses in the south near the border were more than offset by tech jobs and employment aided by the surge in energy prices. A number of multinationals, which include AT&T (NYSE: T), Texas Instruments (NASDAQ: TXN) and Dell (NASDAQ: DELL), keep their headquarters in Texas. The diversity of the state economy is helped by the state’s extremely low tax base.

Low taxes + high diversity= low unemployment.

Douglas A. McIntyre

Filed under: Labor & Unions Tagged: DELL, T, TXN

Top Earnings Previews For Early In The Week Ahead (COP, ILMN, NFLX, TXN, AMGN, AAPL, T, BIDU, COH, JNPR, MMM, RF, X, UTX)

Administrator — Fri, 20 Apr 2012 18:35:20 +0000

Earnings season is in full swing and we have many key reports due in the coming week. 24/7 Wall St. has provided some detailed previews for the key earnings reports we expect to show in detail on Monday and Tuesday.

We are monitoring earnings reports from the following companies for Monday and Tuesday: ConocoPhillips (NYSE: COP); Illumina Inc. (NASDAQ: ILMN); Netflix, Inc. (NASDAQ: NFLX); Texas Instruments Inc. (NASDAQ: TXN); Amgen Inc. (NASDAQ: AMGN); Apple Inc. (NASDAQ: AAPL); AT&T Inc. (NYSE: T); Baidu Inc. (NASDAQ: BIDU); Coach Inc. (NYSE: COH); Juniper Networks Inc. (NYSE: JNPR); 3M Co. (NYSE: MMM); Regions Financial Corporation (NYSE: RF); United States Steel Corporation (NYSE: X); and United Technologies Corporation (NYSE: UTX).

More earnings report previews will come on Sunday or Monday for the reports due on Wednesday, Thursday, and Friday. Consensus estimates and price targets are from Thomson Reuters. Color has been on added on each if applicable.

MONDAY, April 23

ConocoPhillips (NYSE: COP) is set to report Monday morning and the break-up is going to make any real apples to apples comparison difficult to interpret. Thomson Reuters has estimates of $2.07 EPS. Shares are trading around $73.15 and the 52-week range is $58.65 to $81.50; Thomson Reuters had a consensus target as of Friday of $81.05.

Illumina Inc. (NASDAQ: ILMN) is no market mover with a $5.4 billion market cap, but it is a recent merger candidate even if that appears to be off the table. Earnings estimates are $0.32 EPS and $263.6 million. Shares are trading around $44.00 and the 52-week range is $25.57 to $79.40; Thomson Reuters had a consensus target as of Friday of $52.71.

Filed under: Calendar, Earnings, The Week Tagged: AAPL, AMGN, BIDU, COH, COP, ILMN, JNPR, MMM, NFLX, RF, T, TXN, UTX, X

Texas Instruments Avoids Nokia Hangman For Now (TXN, NOK, ERIC)

Administrator — Wed, 11 Apr 2012 14:45:36 +0000

Texas Instruments Inc. (NASDAQ: TXN) is trading up so far with the broader equity and technology markets. The question which needs to be asked is “Should it really be up?”…

The warnings out of Nokia Corporation (NYSE: NOK) this morning were pretty harsh as the company continues to get crowded out. Texas Instruments has suffered from Nokia’s woes before as it is a key customer of TI’s chipsets. You cannot always draw a straight line between the two because TI does have other large customers as well. That being said, it happened just in 2011 where Nokia’s woes translated directly to a hit in TI’s earnings. As of last summer, ZDnet noted that Nokia was 10% to 20% of TI’s revenues.

It is almost surprising that Ericsson (NASDAQ: ERIC) is not lower as well as its shares are up 2.2% at $9.78 in New York trading. Earlier this year there had been warnings that Ericsson could be impacted by declining sales of Nokia’s legacy Symbian smartphones.

Nokia shares have recovered some off of their lows, but the stock is still at a decade low of $4.33 after a 14% drop on a whopping 87 million shares after just over an hour of trading.

Texas Instruments Inc. (NASDAQ: TXN) is up 1.2% at $32.09 against a 52-week range of $24.34 to $35.98. Maybe this time will be different. Maybe.

JON C. OGG

Filed under: ADR, Earnings Warning, Semiconductor, Technology Companies, Telecom, Wireless Tagged: ERIC, NOK, TXN

24/7 Wall St. Closing Bell (AMZN, GRPN, RIO, TXN, GM, DDMG, CLRO, GPN, CMVT, ISCA, VRNG, WG, KERX, PNCL)

Paul Ausick — Mon, 02 Apr 2012 20:05:23 +0000

Markets opened lower this morning but managed to recover fairly quickly following a report on robust manufacturing growth (our coverage here). The report on construction spending came in weaker than expected (our coverage here). The US dollar index fell today, now down -0.22% at 78.831. Commodities were mixed on the weaker dollar, with corn and soybeans rising and wheat falling. WTI crude oil closed up about 2.2% at $105.23/barrel, and Brent crude trades up 2.08% at $125.44/barrel. Gold settled up 0.5% today, at $1,679.70/ounce.

The unofficial closing bells put the DJIA up more than 52 points to 13,264.49 (0.40%), the NASDAQ rose more than 28 points (0.91%) to 3,119.70, and the S&P 500 rose 0.74% or more than 10 points to 1,418.89.

There were several analyst upgrades and downgrades today, including Amazon.com Inc. (NASDAQ: AMZN) raised to ‘buy’ at BofA/ML; Groupon Inc. (NASDAQ: GRPN) cut to ‘sell’ at Stifel Nicolaus and cut to ‘neutral’ with a $20 target price at BofA/ML; Rio Tinto PLC (NYSE: RIO) raised to ‘overweight’ at Barclays; Texas Instruments Inc. (NASDAQ: TXN) cut to ‘neutral’ at UBS; and General Motors Co. (NYSE: GM) started as ‘overweight’ at Morgan Stanley.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Digital Domain Media Group Inc. (NYSE: DDMG) is down -1.6% at $5.60; ClearOne Communications Inc. (NASDAQ: CLRO) is down -5.4% at $4.26; and Global Payments Inc. (NYSE: GPN) is down -4.2% at $45.49. Before markets open tomorrow we’ll get earnings from Comverse Technology Inc. (NASDAQ: CMVT) and International Speedway Corp (NASDAQ: ISCA).

Other standouts from today include the following stocks:

Groupon is down more than -16% at $15.31. The internet coupon company is restating earnings again. More coverage here and here.

Vringo Inc. (AMEX: VRNG) is up more than 84% at $3.04 after posting a new 52-week high of $3.09 earlier today. The ringtone company is merging with a patent protection firm. More coverage here.

Willbros Group Inc. (NYSE: WG) is up nearly 23% at $3.98. The oil & gas construction company had good news and bad news this morning. More coverage here.

Keryx Biopharmaceuticals Inc. (NASDAQ: KERX) is down more than -64% at $1.78 after posting a new 52-week low of $1.63 earlier. The drug company’s colorectal cancer treatment failed a trial. More coverage here.

Pinnacle Airlines Corp. (NASDAQ: PNCL) is down nearly 51% at $0.67 after posting a new 52-week low of $0.50 earlier. The US air carrier has filed for bankruptcy protection. More coverage here.

Stay tuned for Tuesday. Automakers will be reporting March sales throughout the day. San Francisco Fed President John Williams is giving a speech. We have also noted the following events on the schedule (all times Eastern):

10:00 a.m. – Factory orders
11:30 a.m. – 4- and 52-week bill auctions
4:30 – FOMC minutes released

Paul Ausick

Filed under: Analyst Calls, HI/LOW, Market Close Tagged: AMZN, CLRO, CMVT, DDMG, GM, GPN, GRPN, ISCA, KERX, PNCL, RIO, TXN, VRNG, WG

Top Analyst Upgrades & Downgrades (AMZN, BIP, XLS, GM, GPRN, ICE, LLTC, PRXL, PKD, PVH, GOLD, RIO, LUV, SHW, TXN)

Administrator — Mon, 02 Apr 2012 12:15:49 +0000

These are some of the top analyst upgrades, downgrades, and initiations seen from Wall Street research calls this Monday. Some of these calls are moving the shares this morning.

Amazon.com, Inc. (NASDAQ: AMZN) Raised to Buy at BofA/ML.

Brookfield Infrastructure Partners L.P. (NYSE: BIP) Cut to Neutral at BofA/ML.

Exelis, Inc. (NYSE: XLS) Cut to Neutral at JPMorgan.

General Motors Company (NYSE: GM) Started as Overweight at Morgan Stanley.

Groupon, Inc. (NASDAQ: GRPN) Cut to Neutral with $20 target at BofA/ML; Cut to Sell at Stifel Nicolaus.

IntercontinentalExchange, Inc. (NYSE: ICE) named as Bull of the Day at Zacks.

Linear Technology Corporation (NASDAQ: LLTC) Cut to Neutral at UBS.

PAREXEL International Corporation (NASDAQ: PRXL) Cut to Neutral at Stern Agee.

Parker Drilling Company (NYSE: PKD) named as Value stock of the day at Zacks.

PVH Corporation (NYSE: PVH) Raised to Outperform at Credit Suisse.

Rangold Resources Limited (NASDAQ: GOLD) Cut to Neutral at Nomura.

Rio Tinto PLC (NYSE: RIO) Raised to Overweight at Barclays.

Southwest Airlines Co. (NYSE: LUV) named as Bear of the Day at Zacks.

The Sherwin-Williams Company (NYSE: SHW) Cut to Neutral at BofA/ML.

Texas Instruments Inc. (NASDAQ: TXN) Cut to Neutral at UBS.

JON C. OGG

Filed under: Analyst Calls Tagged: AMZN, BIP, GM, gold, GPRN, ICE, LLTC, LUV, PKD, PRXL, PVH, RIO, SHW, TXN, XLS

JCPenney’s Shameless Board Rewards Departing CEO

247wallst — Mon, 02 Apr 2012 10:38:37 +0000

JCPenney’s (NYSE: JCP) former chief executive, Myron E. Ullman, III, was pushed out of the company. As a reward for an awful performance in his job, the the retailer’s board gave him a parting gift of $34,561,322 in salary, stock, stock options and “other compensation.” A portion of the payout was a $10,100,000 transition services payment. That is a staggering amount for a CEO who failed shareholders so badly. It is yet another reason that investors are skeptical about how boards treat their managements.

In 2007, JCPenney had revenue of $19.9 billion and net income of $1.13 billion. In 2011, revenue was down to $17.8 billion, and the retailer had net income of $389 million. Over that period, the value of the retailer’s shares dropped more than 55%.

Who should be blamed for keeping Ullman for so long? The board should, particularly those members who have served for more than five years. This includes Colleen C. Barrett , who was CEO of Southwest Air (NYSE: LUV); Thomas J. Engibous, former CEO of Texas Instruments (NASDAQ: TXN) and the new chairman of JCPenney; Leonard H. Roberts, the former CEO of RadioShack (NYSE: RSH); and Kent B. Foster, the former head of Ingram Micro (NYSE: IM). Each has done shareholders a huge disservice and shown again why JCPenney is a second-rate operation.

Douglas A. McIntyre

Filed under: Corporate Governance, Management Change Tagged: IM, JCP, LUV, RSH, TXN

Intel Posts Gain in Semiconductor Market (INTC, ARMH, SSNLF, TXN, QCOM)

Paul Ausick — Mon, 26 Mar 2012 16:28:30 +0000

Intel Corp. (NASDAQ: INTC) grew its share of the total global semiconductor market to 15.9% in 2011, posting growth of nearly 21% year-over-year, based on the latest research from iSuppli. Licensees of the ARM designs of ARM Holdings plc (NASDAQ: ARMH), including Samsung Electronics (OTC: SSNLF.PK) and Qualcomm Inc. (NASDAQ: QCOM) also saw share rises, as did Texas Instruments Inc. (NASDAQ: TXN).

Demand for Intel’s latest PC chips, together with higher demand for NAND flash memory drove the company’s performance in 2011. Intel also got a boost from its acquisition of mobile chipmaker Infineon Technologies. Texas Instruments’ acquisition of National Semiconductor boosted the company from 4th place to 3rd, while demand for Qualcomm’s ARM-based chips catapulted the company from 9th to 6th in the rankings. Qualcomm’s total grew by nearly 42% to 3.3% of the global market.

The iSuppli press release is available here.

Filed under: Industry, Semiconductor, Semiconductors, Technology, Technology Companies, Wireless Tagged: ARMH, INTC, QCOM, SSNLF, TXN