Facebook Q4 Earnings

Posted on | by Todd | Leave a Comment on Facebook Q4 Earnings

Shares of Facebook traded to an all-time high of $137.00 just after posting better-than-expected Q4 earnings and revenue results.

The social media giant announced adjusted EPS of $1.41 per share on quarterly revenue of $8.81 billion. These numbers exceeded the street’s estimates of $1.31 per share on revenue of $8.532 billion.

In addition, Facebook announced that Daily active users increased 18% year-on-year to 1.23 billion, while monthly active users grew 17% to 1.86 billion.

However, during the earnings call, CFO, David Wehner indicated that expenses will increase in 2017.

Chart – Facebook

Boral – FY18 Earnings Review

Posted on | by Leon Hinde | Leave a Comment on Boral – FY18 Earnings Review

We thought it worthwhile to review the earnings outlook for Boral, post the acquisition of the Headwaters Group.

In FY18 revenue grows to $6.2b, EBITDA $1b, EPS $0.38 and DPS of $0.24 placing the stock on a 4% forward yield.

We’re cautious of the risks for Boral in achieving these targets and it appears the stock is relatively full value at the current price.

Chart – Boral

 

Exxon Q4 Results

Posted on | by Todd | Leave a Comment on Exxon Q4 Results

Shares of Exxon Mobil hit a 4-month low of $83.10 after the company missed Q4 earnings and revenue expectations.

The company announced earnings of 41 cents per share on revenue  of $61.1 billion. This compares to expectations of 70 cents per share on revenue of $61.4 billion.

The year-over-year data was mixed as Exxon earnings fell from 67 cents per share, but revenue rose from $59.8 billion against this time last year.

An upstream asset impairment charge of $2 billion, related to dry gas operations in the Rocky Mountain region, impacted Q4 as well as full-year earnings.

From a technical perspective we’re in a lower high structure with the next significant level of support near $80.00

Chart – Exxon

Apple Q1 Results

Posted on | by Todd | Leave a Comment on Apple Q1 Results

Shares of Apple are up 3% to $125.00 as Q1 earnings and revenue beat expectations. The firm also announce that they sold a record 78.4 million iPhones over the three month period.

Earnings were announced at $3.36 per share on revenue of $78.4 billion. The street was expecting earnings of $3.22 per share and revenue of $77.3 billion.

To put these sales and earnings numbers into perspective: Q1 2017  iPhone sales generated 69% of the company’s total revenue. This compares to 2.5% in Q1 2008.

One of the few negative aspects of the report was the forward guidance. The firm announced a modest cut to Q2 revenue to $51.5 billion from $53.8 billion expected.

As the market absorbs this report and lower forward guidance, we see price support back on the old resistance near $118. A break below $118 will validate our recent Algo Engine short signal. With price trading above our breakout range, we’re on the sideline for the time being with this trade.

Chart – Apple

Ansell – Buy Signal

Posted on | by Leon Hinde | Leave a Comment on Ansell – Buy Signal

Ansell has purchased Nitritex, a UK-based manufacturer of premium clean-room and healthcare Life Sciences consumables. The deal is relatively small at US$60m and will be  near-term earnings accretive.

The transaction adds to income generated outside the US and extends to the Ansell’s expertise across the Life Sciences segment.

We’re buyers of Ansell on the current price pullback. Value exists in the $22.50 – $23.50 range.

FY17 revenue $1.65b, EBITDA of $285m, net profit $170m, EPS $1.10 and DPS $0.46 places the stock on 2.5% forward yield.

We expect underlying business growth into FY18 and FY19 of 6% – 9%.

Chart – ANN

 

European Economic Growth for 2016

Posted on | by Leon Hinde | Leave a Comment on European Economic Growth for 2016

European economic growth for 2016 rose to  1.7%. Inflation is running at  1.8%, which is nearing the ECB’s target of 2% and the jobless rate fell to 9.6%; the lowest figure since May 2009.

This is the first time since 2008 that we’ve seen EU growth prospects tracking near the rate of the US. By any comparison, the economic recovery in G7 countries is still at very low levels and fragile global conditions remain.

Equity market valuations are stretched, and subdued revenue growth will likely lead to analysts’ EPS targets being reduced by 50% for 2017 to reflect actual current growth rates.

Our Algo Engine triggered a short signal in the iShares Europe ETF back in May at $55.75 and the index collapse by 18% within a few months following. Six months on and the index has recovered back to $52 and whilst we don’t have a new short signal present, we’re still cautious that another near term top is now in place.

Chart – iShare ETF (Europe)