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Stock Market & Financial Investment News

News For MSFT;INTC;DELL;HPQ;WDC;STX;EMC;QCOM From The Last 14 Days
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January 27, 2016
16:06 EDTQCOMQualcomm sees Q2 adjusted EPS 90c-$1.00, consensus $1.02
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16:05 EDTQCOMQualcomm reports Q1 adjusted EPS 97c, consensus 90c
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15:10 EDTSTX, WDCEarnings Watch: Western Digital deal update focus of SanDisk report
SanDisk (SNDK) is expected to report fourth quarter earnings after the close on Wednesday, January 27. SanDisk will not hold a conference call to discuss its financial results in light of the pending acquisition by Western Digital (WDC). SanDisk manufactures data storage solutions, including removable and embedded Flash memory and solid-state drives. EXPECTATIONS: Analysts are looking for earnings per share of 89c on revenue of $1.44B. The consensus range is 83c-$1.00 for EPS on revenue of $1.4B-$1.47B, according to First Call. Along with its last earnings report, SanDisk guided to Q4 revenue of $1.4B-$1.475B and a non-GAAP gross margin 40%-43%. LAST QUARTER: On October 21, SanDisk reported third quarter earnings per share of $1.09 and revenue of $1.45B, compared to expectations of 80c and $1.4B, respectively. NEWS: Along with releasing its earnings report, SanDisk announced a definitive agreement under which Western Digital will acquire all of the outstanding shares of SanDisk for a combination of cash and stock that values SanDisk common stock at $86.50 per share, or a total equity value of approximately $19B. If the investment in Western Digital by Unisplendour Corporation closes prior to this acquisition, Western Digital will pay $85.10 per share in cash and 0.0176 shares of Western Digital common stock per share of SanDisk common stock; and if the Unisplendour transaction has not closed or has been terminated, $67.50 in cash and 0.2387 shares of Western Digital common stock per share of SanDisk common stock. The companies said at the time that the transaction is expected to close in the third quarter of 2016. STREET RESEARCH: On December 28, Brean Capital analyst Ananda Baruah said the combined Western Digital-SanDisk company, post an expected merger close in September of this year, can generate FY17 earnings per share of $13-$15. He kept a $150 standalone Western Digital target price and believes that the combined company's shares should trade in a range of $154-$256 post close. On January 6, Pacific Crest analyst Monika Garg called Western Digital her best idea for 2016, stating that the company's pending acquisition of SanDisk "would create a formidable company" and bring significant earnings and cash flow generation. On January 25, CLSA analyst Mark Heller downgraded SanDisk to Underperform due to weakening NAND fundamentals and higher deal risk. The analyst does not believe Western Digital can walk away from the deal due to weakening fundamentals, but is more cautious on Unisplenour's investment in Western Digital. Heller lowered his price target to $70 from $86 on SanDisk shares. The same day, Jefferies analyst James Kisner lowered his estimates for Western Digital and Seagate (STX), citing the weak results and guidance from Nidec and a more conservative approach following the recent selloff in the shares. Western Digital's current valuation fully prices in an "extreme bear case" for the combined Western Digital and SanDisk, Kisner told investors in his research note. The analyst cut his price target for Western Digital to $82 from $95 but kept a Buy rating on the stock. Noting that the Committee on Foreign Investment in the United States would not grant regulatory clearance for Philips (PHG) to sell an 80.1% interest in Lumileds to China's GO Scale Capital, Summit Research analyst Srini Sundararajan said on January 26 that he thinks that the Unisplendour investment in Western Digital is more than likely to be stalled, if not blocked, given the current political climate. However, he also believes Western Digital planned for this contingency and that its deal with SanDisk should still go through. This morning, Citi analyst Stanley Kovler initiated coverage of Western Digital with a Buy rating, as the firm is relatively bullish on the company's acquisition of SanDisk. Conversely, Citi started coverage of Seagate (STX) with a Sell rating, saying that actions it has taken to cope with the decline of the sector "may only help so much." Kovler set an $82 price target on SanDisk, a $53 price target on Western Digital and a $23 price target on Seagate. PRICE ACTION: In afternoon trading, SanDisk rose 0.75% to $64.57 per share. Since October 21, shares of SanDisk have declined about 14%. Since that same day, Western Digital shares are down over 41%.
14:44 EDTQCOMEarnings Watch: Qualcomm reports after breakup decision, China licensing deals
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14:34 EDTQCOMNotable companies reporting after market close
Notable companies reporting after the market close, with earnings consensus, include Facebook (FB), consensus 68c... Qualcomm (QCOM), consensus 90c... Texas Instruments (TXN), consensus 69c... McKesson (MCK), consensus $3.13... PayPal (PYPL), consensus 35c... Las Vegas Sands (LVS), consensus 65c... eBay (EBAY), consensus 50c... Crown Castle (CCI), consensus $1.10... Vertex (VRTX), consensus 17c... Discover (DFS), consensus $1.30... SanDisk (SNDK), consensus 89c... ServiceNow (NOW), consensus 8c... Lam Research (LRCX), consensus $1.43... Citrix Systems (CTXS), consensus $1.19... Hologic (HOLX), consensus 42c... Juniper (JNPR), consensus 59c... Cavium (CAVM), consensus 28c... Cirrus Logic (CRUS), consensus 81c.
14:28 EDTQCOMQualcomm January weekly 48 straddle priced for 6% movement into Q1
13:47 EDTMSFT, EMCVMware tanks after providing lower guidance amid Cloud transition
Shares of virtualization software maker VMware (VMW) are falling after providing guidance, confirming layoffs and announcing executive changes. WHAT'S NEW: After the close of trading on Tuesday, the software company that is 80% owned by EMC (EMC) and provides software for corporate data centers, announced fourth quarter financial results while confirming earlier reports of layoffs and announcing a new chief financial officer. VMware, along with parent company EMC, is in the midst of a proposed acquisition by Dell. The company's Q4 earnings per share and revenue came in at $1.26 and $1.87B, respectively, slightly better than analysts were expecting; however, the company's view for fiscal year 2016 EPS and revenue of $4.07-$4.16 and $6.8B-$6.9B, respectively, were well below the $4.20 and $7.21B analysts are expecting. VMware also guided first quarter EPS to 83c-85c, also below analysts' 92c consensus. Along with its results, the company confirmed earlier reports that it intended to reduce its workforce by 800 and plans to take a charge of between $55M-$65M related to this action over the course of the first half of 2016. The company also announced that its CFO Jonathan Chadwick is leaving and will be replaced by EMC CFO Zane Rowe. WHAT'S NOTABLE: On its quarterly conference call discussing its earnings, VMware company referred to its growth in "emerging" products and businesses including NSX and User Computing and Virtual SAN, all of which grew strongly over the quarter. The company said it hopes its newer products are picking up the slack due to the declining growth in its mature "compute products." Pat Gelsinger, VMware's chief executive officer, "We recognize that our blockbuster compute products are reaching maturity and will represent a decreasing portion of our business going forward." The company is upgrading its Cloud strategy to better compete with leaders like Amazon (AMZN) and Microsoft (MSFT), which provide Cloud services via the internet and make the corporate data center that VMware focuses on less necessary. ANALYSTS' VIEWS: Summit Research analyst Srini Nandury downgraded VMware to Hold and lowered his price target for the shares to $40 from $80 following the company's quarterly results. The company's business will get worse before it gets better, Nandury told investors in a research note. Another downgrade came from research firm Baird's analyst Jayson Noland, who cut his rating on VMware to Neutral and lowered his price target to $60 from $80. Noland said the core vSphere business is facing incremental public cloud headwinds and substantial uncertainty related to the Class V common stock being issued to finance the EMC acquisition. Providing a more constructive view was UBS who said the current valuation levels of VMware offer a significant opportunity for patient investors. The firm noted the company will temper spending and focus on leveraging public clouds, which should provide a tailwind to both capital and operating expenditures. UBS reiterated its Buy rating and $72 price target on VMware. PRICE ACTION: Shares of VMware are down approximately 40% since the Dell-EMC deal was announced last October and are down over 9% to $44.84 in afternoon trading. OTHERS TO WATCH. Other companies in the cloud computing space include Amazon, Microsoft and Citrix Systems (CTXS).
12:02 EDTMSFTBox, Microsoft expand alliance to deliver better cloud experiences
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11:13 EDTSTX, WDCCiti mixed on hard disk drive makers, says sell Seagate, buy Western Digital
Citi initiated coverage of hard disk drive, or HDD, maker Western Digital (WDC) with a Buy rating, as the firm is relatively bullish on the company's acquisition of flash memory developer SanDisk (SNDK). Conversely, Citi started coverage of the other major hard disk drive maker, Seagate (STX), with a Sell rating, saying that actions it has taken to cope with the decline of the sector "may only help so much." Stating that the sector has begun a decline that should last for quite some time, the firm believes that Western Digital's actions to cope with this situation are more effective than those taken by its competitor. WHAT'S NEW: Western Digital's pending acquisition of SanDisk makes the company more stable, and will raise its margins and profits, according to Citi analyst Stanley Kovler. The deal will increase Western Digital's earnings per share by a greater amount than if the company had continued its shares buybacks, the analyst added. Conversely, Seagate is trying to lower its costs and improve its products and execution, Kovler noted. The company also entered the solid state drive market, he stated. Given Seagate's limited exposure to markets other than HDD and the "malaise" in that market, the company may seek to make a "potentially transformative" acquisition, the analyst stated. But in light of its "limited financial flexibility," such a deal could limit its ability to return cash to shareholders, Kovler warned. Moreover, any acquisition made by the company may not be large enough to "fully transform" Seagate, according to Kovler, who set a $53 price target on Western Digital and a $23 price target on Seagate. PRICE ACTION: In late morning trading, Western Digital fell 1% to $44.83 and Seagate lost 1.6% to $27.29.
10:07 EDTMSFTMicrosoft announces launch of News Pro app
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10:00 EDTWDCOn The Fly: Analyst Initiation Summary
Today's noteworthy initiations include: Arista Networks (ANET) initiated with a Buy at Citi... Brocade (BRCD) initiated with a Neutral at Citi... CBL & Associates (CBL) initiated with an Underperform at Boenning & Scattergood... Caleres (CAL) initiated with a Hold at BB&T... Ciena (CIEN) initiated with a Neutral at Citi... Fitbit (FIT) initiated with a Buy, $35 target at Citi... Genesco (GCO) initiated with a Hold at BB&T... Infinera (INFN) initiated with a Buy at Citi... Nabriva Therapeutics (NBRV) initiated with a Buy at Gabelli... SanDisk (SNDK) initiated with a Buy at Citi... Seagate (STX) initiated with a Sell at Citi... Tanger Factory (SKT) initiated with an Underperform at Boenning & Scattergood... Taubman Centers (TCO) initiated with a Neutral at Boenning & Scattergood... WP Glimcher (WPG) initiated with an Underperform at Boenning & Scattergood... Western Digital (WDC) initiated with a Buy at Citi... Yirendai (YRD) initiated with a Buy at Needham.
09:29 EDTEMCFacebook data center project supported by telco heavyweights, FT reports
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09:15 EDTEMCEMC says 'highly confident' in contractual terms of Dell deal
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08:56 EDTEMCEMC CEO says 'very committed' to partnership with Cisco
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07:59 EDTMSFTMicrosoft volatility elevated into Q2 and outlook
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07:19 EDTQCOMQualcomm volatility elevated into Q1 and outlook
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07:07 EDTEMCEMC says not providing 2016 outlook given pending merger
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07:07 EDTEMCEMC CFO says confident in exceeding cost reduction goal
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07:06 EDTEMCEMC CEO says progress on closing Dell transaction on track
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07:05 EDTEMCEMC reports Q4 EPS 65c, consensus 65c
Reports Q4 revenue $7B, consensus $7.12B. EMC generated $1.9B in operating cash flow and $1.5B in free cash flow in the fourth quarter, and ended the quarter with $14.8B in cash and investments.
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