Stock Market / Earnings Expectations for 2009

Dhirendras investment recommendations for a 25-year-old

2010-12-20T06:31:00.000-08:00

Google Beats Forecast

2009-01-22T17:07:00.000-08:00

Google Beats Street

Fri, Jan 23 05:06 AM

Courtesy : Yahoo News

Google Inc's quarterly earnings beat Wall Street forecasts as strong advertising sales on its self-branded websites helped the Internet leader defy the gloom pervading the tech sector.

The results, which sent Google shares up 2.6 percent in after-hours trading, were a relief for investors who had been stunned by a series of dismal reports from Microsoft Corp, Intel Corp and other tech companies.

"At least we have something to feel good about with this Google news in what has been shaping up to be a gloomy earnings period," said Keith Wirtz, president and chief investment officer of Fifth Third Asset Management, which manages $22 billion.

"It tells me that Google is very focused on their franchise and execution as a marketing, advertising and media company. It speaks highly to their business focus."

Google said fourth-quarter net income fell to $382 million, or $1.21 a share, from $1.21 billion, or $3.79 a share, a year earlier due to impairment charges on its investments in Clearwire Corp and Time Warner Inc unit AOL.

Excluding one-time charges, profit was $5.10 a share, beating the average analyst forecast of $4.95 according to Reuters Estimates.

Revenue rose 18 percent to $5.7 billion -- a shadow of the 50 percent growth levels that Google used to enjoy, but considered by analysts to be a robust performance given the weak economy and corporate cutbacks in advertising spending.

"It was, all things considered, very good numbers," said Wunderlich Securities analyst Martin Pyykkonen, noting Google's non-GAAP operating margin of 38 percent was also solid.

"In this market and relative to the numbers that are being put out -- and I would go so far as to say relative to the numbers that Yahoo probably will put out next week -- these will look good and maybe I'll use the term 'as good as it gets' as far as Internet stock performance goes."

WEAKNESS IN UK MARKETS

Google's revenue comes via searches on its branded sites such as google.com and google.co.uk, as well as through partnerships which license its search advertising platform.

Google-owned sites generated 67 percent of revenue, or $3.81 billion, rising 22 percent from a year ago. Traffic acquisition costs, the portion of revenues shared with Google's partners, decreased to $1.48 billion.

Cantor Fitzgerald analyst Derek Brown, who has a buy rating on Google and makes a market in its shares, said that was better than he had expected.

"It's clear that macroeconomic challenges continue to rob Google of growth, but it seems equally clear that the company continues to make headway in this market, and take share in this market," Brown said.

Google Chief Executive Eric Schmidt struck a cautious note, saying the last quarter had benefited from the holiday season.

"Now clearly we're in a worldwide recession as everybody knows, rising unemployment, foreclosures, that sort of thing," he said on a conference call. "But we don't know how long this period will last. We obviously hope it will be short."

Chief Financial Officer Patrick Pichette said Google's UK business showed "some softness" largely due to the weak British pound. UK revenue fell 1 percent to $685 million.

But the rest of Europe performed better, driven by strong performances in Germany, France and the Netherlands, Google said. Overall international revenue, which accounted for 50 percent of total revenue, was relatively flat.

Paid clicks -- a measure of how often Google gets paid for advertisements alongside its Web search results -- rose 18 percent. Investors have worried that Google's paid search business would face keyword pricing deflationary pressures due to the worsening economy, but the company said search query growth was strong with revenues up in most verticals.

Google's stock has fallen by more than half in the last year as investors expected its pay-per-click advertising format to be hit by the wider advertising market slump.

The shares rose to $314.51 in after-hours trading from their Nasdaq close of $306.50.

Just 13 months ago, Google's stock hit an all-time high of $747 as investors bet moves into new advertising formats such as mobile phones and YouTube would bring in huge returns.

Google joins International Business Machines Corp and Apple Inc as the few bright spots in a tech sector hurt by sweeping job cuts and cutbacks in corporate and consumer spending.

It has stepped up efforts to rein in expenses, to the relief of Wall Street and investors. Late last year, it confirmed that it was cutting back on the use of contractors and earlier this month it laid off 100 recruiters -- significant for a company which has previously hired at a rapid pace.

Rebounds Vs Recoil in Indian Markets

2009-01-21T17:20:00.000-08:00

Wall St rebounds on IBM, financials - Thu, Jan 22 03:10 AM

Courtesy : Yahoo News

Indian markets had a tough time bouncing back as the Asian stock markets were trading mixed and brought the SENSEX down by

U.S. stocks jumped on Wednesday, rebounding from a two-month low, after a surprisingly healthy earnings report from IBM fueled optimism that technology may fare better than other sectors during the recession.

Financial stocks outperformed as well on the strength of earnings surprises from Northern Trust and PNC Financial Services, helping the group reclaim some of Tuesday's massive losses that dropped the financial sector to a 14-year low.

The market shrugged off a brief sell-off after Treasury Secretary nominee Timothy Geithner faced tough questioning at his confirmation hearing before a Senate committee.

The day after earnings results from State Street alarmed investors about losses in one of the safest parts of banking, earnings from rival Northern Trust Corp on Wednesday soothed investor concerns after its net income more than doubled. The financial services company's shares shot up nearly 31 percent to $57.51.

PNC Financial Services Group Inc also projected lower loan losses from its purchase of National City Corp, sending its shares soaring 37 percent to $30.16.

"People are excited because financials are valued so low at this point. It's the mentality that they can't get any lower, but they've proven time and time again that they can," said Jocelynn Drake, market analyst at Schaeffer's Investment Research in Cincinnati, Ohio.

The Dow Jones industrial average gained 279.01 points, or 3.51 percent, to 8,228.10. The Standard & Poor's 500 Index rose 35.02 points, or 4.35 percent, to 840.24. The Nasdaq Composite Index climbed 66.21 points, or 4.60 percent, to 1,507.07.

International Business Machines Corp provided the biggest lift to the Dow, jumping nearly 12 percent to $91.42 after the world's top technology services company posted a quarterly profit and a 2009 profit outlook that surpassed Wall Street's expectations. That burst of strength from IBM led investors to believe the Dow component can weather the global economic downturn.

Hearings on Geithner's appointment attracted the market's attention for much of the day as he is seen as President Barack Obama's point man in battling the economic crisis. As the president of the Federal Reserve Bank of New York since 2003, Geithner is expected to hit the ground running if confirmed as Treasury secretary.

A day after his historic inauguration, Obama met with his economic advisers, who are working with the Democratic-led Congress on an $825 billion fiscal stimulus package.

The drove gains in the S&P 500 following Tuesday's sharp sell-off, which was ignited by deepening fears of insolvency among banks.

The broad KBW index of bank stocks and the S&P financials index both jumped 14.6 percent.financial sector

Bank of America shares climbed 31 percent to $6.68 after Chief Executive Kenneth Lewis purchased 200,000 common shares, four days after the posted its largest quarterly loss in 17 years.

JPMorgan Chase ranked as the Dow's second-biggest advancer, surging 25.1 percent to $22.63.company

On the downside, Wal-Mart Stores Inc was the heaviest weight on the Dow after being downgraded to a "neutral" rating by Credit Suisse. Shares of Wal-Mart, the world's largest retailer and leading discount chain, slid 2.8 percent to $49.14.

Apple led the Nasdaq higher ahead of its quarterly earnings after the closing bell, despite a report that U.S. regulators were examining the company's disclosures about Chief Executive Officer Steve Jobs' health problems to ensure investors were not misled. Apple's stock rose 5.9 percent to $82.83.

Trading volume was active on the New York Stock Exchange, with about 1.74 billion shares changing hands, above last year's estimated daily average of roughly 1.49 billion, while on Nasdaq, about 2.12 billion shares traded, below last year's daily average of 2.28 billion.

Advancing stocks outnumbered declining ones on the NYSE by a ratio of 4 to 1, while on the Nasdaq, about three stocks rose for every one that fell.

Expectations for 2009 - Stocks , Economy

2008-12-27T05:09:00.000-08:00

As the year comes to an end with hope and despair, world over people are still expecting that there is recovery and Bulls returning to World Stock Markets. Economies all over world are reeling under impact of global recession which is causing havoc and now it is having a ripple effect.

So called Big Economies and JUMBO Economies like America have started to reel and is in recession and it will go to a full fledged recession next year. More bankruptcies and Bailouts will rule the year for America .

As far as Indian economy, markets need cheer from RBI / Rate cuts and most important CRR/SLR rate cuts. Banks also need to minimize the damage done to markets by reducing interest rates and also reduce the burdened MIDDLE CLASS as far as HOME LOANS are concerned .

As Udayan Mukherjee, CNBC TV18 Stocks Editor , remarked there is going to be RANGE BOUND rallies and UP TRENDS but not a relief like the Bulls in full swing but a staggered BULL RUN.

Look forward to see BULLS returning to tame the BEARS and also the NEW OBAMA government and the world economies learn and implement precautionary measures and relief packages to hurt economies by respective governments. Japan has already indicated a downtrend in industrial output and it is a cause of concern as India too need to increase its industrial output and bring down the inflation.

Happy New Year and a great weekend