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Stock Market & Financial Investment News

News Breaks
May 22, 2014
11:56 EDTHPQ, NTAPEarnings Preview: Analysts view HP positively ahead of Q2 earnings report
Hewlett-Packard (HPQ) is set to report second quarter earnings after the market close on Thursday, May 22, with a conference call scheduled for 5:00 pm ET. Hewlett-Packard is a diversified IT company that provides hardware, software, and business and enterprise solutions to personal and corporate customers. EXPECTATIONS: Analysts are looking for earnings of 88c per share on revenue of $27.41B, according to First Call. The consensus range for EPS is 85c-91c on revenue of $26.94B-$28.17B. In its Q1 earnings release, HP said it sees Q2 adjusted EPS 85c-89c and FY14 adjusted EPS $3.60-$3.75, both of which were in-line with expectations. LAST QUARTER: HP reported Q1 EPS of 90c against estimates for 84c on revenue of $28.2B against estimates for $27.19B. HP reported personal systems revenue rose 4% during the quarter against the prior year, while enterprise Group revenue rose 1% over the prior year. HP also reported $3B in cash flow from operations in the first quarter and exited the quarter with $16.4B in gross cash. COMPANY NEWS: HP raised its quarterly dividend by 10.2% to 16c per share on March 20. The company said that the increase in the dividend would be effective when the company's board declares HP's next dividend, which was expected to occur in May. The U.S. Department of Defense's Defense Manpower Data Center awarded a five-year task order worth up to $548M to HP Enterprise on March 5. On April 9, HP announced a resolution of a U.S. Department of Justice and U.S. SEC investigation of potential violations of the Foreign Corrupt Practices Act. HP said it would pay approximately $108M to these two U.S. government agencies and that it agreed to undertake certain compliance, reporting and cooperation obligations. HP Enterprise announced on April 22 that the Colorado Department of Health Care Policy and Financing signed a $116.9M contract for the company to implement a new Medicaid Management system. On May 7, Reuters reported that HP was planning to invest over $1B over the next two years to create and offer cloud-computing products and services and cited statements from the company's Chief Technology Officer Martin Fink. STREET RESEARCH: Wall Street research was generally positive on HP during the quarter, with firms positively receiving the company with upgrades. On February 20, Argus upgraded HP to Buy from Hold based on what it sees as the company's strong cash generation trends and signs that the company's positive top-line and bottom-line comparisons can be sustained going forward. Barclays upgraded HP to Overweight from Equal Weight citing the company's improved free cash flow and expectations it will gain market share in x86 servers over the next several quarters. The firm raised its price target for shares to $38 from $33. On April 29, Pacific Crest upgraded HP to Outperform from Sector Perform citing increased confidence in the company's profit recovery due to expanding margins, enterprise share gains and stabilizing PC trends. The firm set a $37 price target for shares. Brean Capital raised its price target on Hewlett-Packard to $40 from $34 on May 19 as they feel guidance is achievable, the company can find additional cost savings and the company will still use its free cash flow to buy back stock. Brean Capital maintained its Buy rating on the shares. On May 20, however, Citigroup believed that both NetApp (NTAP) and HP "will be challenged" to meet April quarter revenue expectations, but may be able to reach earnings projections due to cost controls. Citi expects HP to reiterate its FY15 earnings outlook and has a Buy rating on HP. PRICE ACTION: Since the first day of trading following HP’s first quarter report on February 20, shares have risen approximately 8.5%. Over the past year, shares have increased over 55%. During late morning trading, shares of HP are up 1.57% to $33.03.
News For HPQ;NTAP From The Last 14 Days
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July 1, 2015
18:49 EDTHPQHP confirms filing Form 10 regarding plan to split into two separate companies
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07:27 EDTHPQHP weakness overdone, says Wells Fargo
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06:10 EDTHPQHP announces departure of Enterprise chief Bill Veghte
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06:01 EDTNTAPStocks with implied volatility below IV index mean; MU NTAP
Stocks with implied volatility below IV index mean; Micron (MU) 38, NetApp (NTAP) 23 according to iVolatility.
June 30, 2015
06:26 EDTHPQHP information chief to clone computer programs to smooth transition, WSJ says
Later this week, Hewlett-Packard is expected to disclose the financial outlines of its successor companies for the first time: HP Inc., which will sell PCs and printers, and Hewlett-Packard Enterprise, a supplier of corporate technology, the Wall Street Journal reports. Scott Spradley, chief information officer at the current HP, soon will start the process of cloning 2,600 internal computer programs, separating their data and restarting them in an effort to keep operations running amid an arduous restructuring effort, the report says. Reference Link
06:04 EDTNTAPStocks with implied volatility below IV index mean; MU NTAP
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05:59 EDTHPQGartner: Worldwide IT spending on pace to decline 5.5% in 2015
Worldwide IT spending is on pace to total $3.5T in 2015, a 5.5% decline from 2014, according to the latest forecast by Gartner, Inc. Analysts attribute the decline to the rising U.S. dollar. In constant-currency terms, the market is projected to grow 2.5%. In Gartner's previous forecast in April, it had forecast IT spending to decline 1.3% in U.S. dollars and grow 3.1% in constant currency. "We want to stress that this is not a market crash. Such are the illusions that large swings in the value of the U.S. dollar versus other currencies can create," said John-David Lovelock, research vice president at Gartner. "However, there are secondary effects to the rising U.S. dollar. Vendors do have to raise prices to protect costs and margins of their products, and enterprises and consumers will have to make new purchase decisions in light of the new prices." Communications services will continue to be the largest IT spending segment in 2015 with spending at nearly $1.5T. However, this segment is also experiencing the strongest decline among the five IT sectors. In the device market, mobile phones continue to be the leading segment, with growth in Apple phones, especially in China, keeping overall phone spending consistent. However, overall smartphone unit growth will start to flatten. The PC and tablet market continues to weaken. The expected 10 percent increase in average PC pricing in currency-impacted countries is going ahead, delaying purchases even more than expected. Excessive PC inventory levels, especially in Western Europe, need to be cleared, which will delay Windows 10 inventory in the second half of the year. Within the data center systems segment, storage and network markets are both expected to see weaker growth in U.S. dollar terms as a result of the appreciation of the U.S. dollar. Reference Link
June 29, 2015
14:53 EDTNTAPBankers see suitors being cool to NetApp amid competition, dealReporter says
Two industry bankers said NetApp’s worsening performance and rising competition are leading to little or no strategic interest from potential suitors, reported dealReporter, according to contacts.
10:02 EDTHPQHP deal for EMC 'more than a distinct possibility,' says Raymond James
Noting that shares of both HP (HPQ) and EMC (EMC) have been stagnant, Raymond James analyst Brian Alexander repeated that he believes shareholders of both would earn substantial returns from a deal between the two and that he thinks an HP acquisition of EMC is "more than a distinct possibility." Alexander previously said in a note to investors on June 4 that he believed HP will ultimately buy EMC, including VMware (VMW). Assuming EMC is acquired for $32-$34 at various combinations of debt/stock, accretion for HP ranges from 39%-52%, Alexander calculates. Raymond James has a Market Perform rating on HP, a Strong Buy rating on EMC and an Outperform rating on VMware.
08:08 EDTHPQJefferies sees recent weakness as attractive entry point in PC names
Jefferies analyst James Kisner cut his PC unit expectations for 2015 and 2016, citing recent negative data points including Micron's (MU) commentary and guidance, but added that he believes PC names may be finding a bottom and that the pullback in Western Digital (WDC), Seagate (STX), and HP (HPQ) creates an attractive entry point in all three stocks. Kisner sees the most potential upside in Western Digital, but lowered his price target on its shares to $116, and said HP may have the least potential downside, cutting his price target on the computer maker to $40.50. The firm keeps Buy rating on both HDD makers and on HP.
06:05 EDTHPQNotebook demand expected to be weaker than expected in 2H15, DigiTimes reports
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June 25, 2015
17:56 EDTHPQMicron plunges after Q3 results, guidance impacted by PC headwinds
Shares of PC related memory chip maker Micron Technology (MU) are plunging after reporting third quarter financial results and fourth quarter guidance that missed analyst expectations. WHAT'S NEW: After the close, Micron reported Q3 earnings per share of 54c on revenue of $3.85B, both shy of analyst estimates of 56c and $3.9B, respectively. Citing "near-term headwinds driven primarily by weakness in PC sector," Micron gave a fourth quarter revenue view of $3.45B-$3.7B which was significantly lower than analyst expectations of $4.16B. WHAT'S NOTABLE: On the company's earnings conference call, Micron said, consistent with prior expectations, "We are forecasting DRAM industry supply bit growth in the mid-20s in calendar 2015 and in the low-to-mid 20s in 2016." The company said it sees DRAM gross margins for Q4 down mid-single digits sequentially. Additionally, the chip maker said it sees Q4 DRAM bit growth flat to up low single digits. ANALYST TAKE: On June 22, Micron was downgraded to Sell from Neutral at Goldman Sachs. Goldman analyst Mark Delaney downgraded Micron Technology to Sell saying rising DRAM supply will lower selling prices and contract margins. Delaney expects DRAM prices to drop up to 30% over the next three quarters and cut his price target for shares to $19 from $27. On the same day, JP Morgan lowered its price target on Micron shares to $33 from $37. The firm also lowered its estimates for Micron citing lower than anticipated DRAM pricing in the past three months. The firm, however, kept an Overweight rating on Micron, saying improving demand in other segments like mobile and the company's decision to not hold inventory during Q3 should help offset the DRAM weakness. PRICE ACTION: Shares of Micron are lower by 11.5% in after- hours trading to $21.25. OTHER PC RELATED STOCKS: In after-hours trading, PC related chip makers are also lower, with Intel Corporation (INTC) down 0.9%, NVIDIA (NVDA) lower by 1.1%, and AMD (AMD) down fractionally. Others trading lower include Microsoft (MSFT), SanDisk (SNDK), Hewlett-Packard (HPQ), and Seagate (STX).
13:31 EDTHPQWi-LAN unit enters into license agreement with Acuity Brands
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07:03 EDTNTAPNetApp did little to alleviate investor concerns, says Piper Jaffray
Piper Jaffray analyst Andrew Nowinski says NetApp's tech talk with new CEO George Kurian did little to alleviate investor concerns since no new initiatives were revealed. New management is continuing to execute the "failed strategy" that prior management initiated, Nowinski tells investors in a research note. He views shares as fairly valued and keeps a Neutral rating on NetApp.
June 23, 2015
12:54 EDTHPQPC concerns weighing on shares of Seagate, Western Digital
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06:05 EDTHPQNo clear prospects for PC component suppliers until July, DigiTimes reports
There are no clear business prospects for PC component suppliers until July, reports DigiTimes. According to sources in the supply chain, Intel's decision to delay the launch of its Skylake platform has weakened market demand for notebooks and other PC systems. The planned release of Microsoft (MSFT) Windows 10 may also affect the production of PC makers. Reference Link

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