Tag Archives: International Business Machines Corp

Southwest, Tesla, Las Vegas Sands

A Southwest Airlines Co. Boeing 737 passenger jet pushes back from a gate at Midway International Airport (MDW) in Chicago, Illinois.

Luke Sharrett | Bloomberg | Getty Images

Check out the companies making the biggest moves premarket:

Southwest — The airline dropped 2.1% after reporting a $220 million loss for the fourth quarter after the holiday meltdown cost the company millions in expenses and drove up expenses.

Comcast — The media company reported fourth-quarter earnings that beat Wall Street’s expectations, with earnings per share coming in at 82 cents, adjusted, versus the 77 cents expected from analysts surveyed by Refinitiv. Revenue was $30.55 billion compared to the $30.32 expected. Shares, however, were down less than 1% in the premarket.

Tesla — The electric-vehicle maker soared 7% after reporting record revenue and an earnings beat. CEO Elon Musk said Tesla might be able to produce 2 million cars this year.

Las Vegas Sands — Shares of the hotel and casino operator rose about 4% despite the company posting weaker-than-expected financial results for the most recent quarter. Wall Street analysts cited upbeat comments about its reopening in Macao on the company earnings call for their positive outlook on the stock.

Levi Strauss — Shares of the denim maker popped 6% premarket on a better-than-expected quarterly report. Levi Strauss topped analysts’ revenue estimates and beat earnings projections by 5 cents a share.

Blackstone — Blackstone shares dipped less than 1% after the asset manager reported mixed earnings results. Total segment revenues fell short of expectations, while distributable earnings beat estimates by 12 cents a share.

Chevron — The energy giant jumped more than 3% in premarket after the company announced a $75 billion stock buyback program and a dividend hike to $1.51 from $1.42 per share. The buyback program will become effective on April 1.

Dow — The chemicals giant posted fourth-quarter earnings, revenue and adjusted EBITDA that missed analyst expectations before the bell Thursday, sending the stock down more than 3% in premarket trading.

IBM — Shares of IBM shed 2.7% after the company reported quarterly results Wednesday that generally exceeded Wall Street’s expectations but included an announcement that the firm will cut 3,900 jobs. IBM reported adjusted earnings per share of $3.60 per share on $16.69 billion in revenue where analysts expected $3.60 per share and $16.4 billion in revenue, per Refinitiv.

American Airlines — The airline gained 1.5% after its fourth-quarter profits beat Wall Street’s expectations, thanks to strong holiday demand and high fares.

Seagate Technology — The data storage company jumped more than 8% in premarket trading after reporting earnings and revenue for the last quarter that beat expectations.

Pfizer — The pharma giant was downgraded by UBS on Thursday, which said Pfizer’s Covid franchise estimates need to come down and its pipeline is too premature. Pfizer was up less than 1% in the premarket.

— CNBC’s Carmen Reinicke, Yun Li, Samantha Subin, Tanaya Macheel and Michael Bloom contributed reporting.

Disclosure: Comcast owns NBCUniversal, the parent company of CNBC.

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Cramer says these 6 ‘positives’ could lift stocks in earnings season

CNBC’s Jim Cramer on Monday said that several elements could help propel stocks higher, even during what could be an ugly earnings season.

Tuesday kicks off a new earnings season featuring some of the biggest companies in technology, retail and consumer goods. Companies like Microsoft, IBM and ServiceNow are slated to report their quarterly financial results this week.

Here are the six factors that could help stocks as companies report earnings, according to Cramer:

  1. More firms are implementing layoffs. Companies including Microsoft, Salesforce and Wayfair recently announced head count cuts, and their stocks popped.
  2. The U.S. dollar and interest rates peaked last fall. Cyclical, more economically sensitive stocks have since bounced, as many companies conduct a large portion of their business overseas.
  3. The Federal Reserve could almost be done raising interest rates. That’s according to a Wall Street Journal report, and could mean that bad loan worries – and possible ensuing damage to banks – could be over.
  4. China’s economy is reopening. The return of the world’s second-largest economy is great news for companies, particularly those in entertainment, travel and consumer goods.
  5. The government is poised to spend big on infrastructure. Cash from the bipartisan infrastructure bill and the Inflation Reduction Act provide a “safety net” for companies that build roads, bridges or tunnels.
  6. Analysts are upgrading chip stocks. Barclays on Monday upgraded Advanced Micro Devices and Qualcomm to overweight. “Remember, the [semiconductor chips] inventory glut included everything from cellphones to desktops to high-performance computers. This is a very big deal,” Cramer said.

Cramer cautioned that while earnings season may still not be smooth sailing, any dips in stock price aren’t necessarily unwelcome.

“At the moment of the first print, when we see the numbers, I still expect to see some vicious declines. The difference from 2022? Those declines, they might be buyable,” he said.

Disclaimer: Cramer’s Charitable Trust owns shares of Advanced Micro Devices, Qualcomm, Salesforce and Microsoft.

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Dow falls 600 points in final minutes of trading as January rally loses steam

Traders work on the floor of the New York Stock Exchange during morning trading on January 17, 2023 in New York City. 

Michael M. Santiago | Getty Images

The Dow Jones Industrial average tumbled more than 600 points on Wednesday as investors took profits on some of the strong 2023 January gains and as a disappointing December retail sales reading raised concerns about a recession. Shares of banks led the losses.

The Dow Jones Industrial Average fell 612 points, or 1.8%, while the S&P 500 lost 1.6%. The Nasdaq Composite lost 1.2% and was on pace for its first down day in the last eight.

Yung-Yu Ma, chief investment strategist at BMO Wealth Management, attributed the reversal to a combination of skittishness and profit taking.

“We’ve had such a strong start to the year, but now we’re amid a tense earnings season, recently got weaker data — retail sales and yesterday’s Empire State Manufacturing Survey. Plus the Fed meeting on Feb. 1st is looming large,” he said. “There’s not a whole lot of reason to get aggressive here, but all of those factors above suggest that caution is warranted in the near term.”

The Dow Jones Industrial Average on Wednesday

Microsoft announced plans to lay off about 10,000 employees, which hurt investor sentiment. The stock fell and dragged the Dow lower with it.

Investors were also digesting the latest retail sales data, which showed a drop of 1.1% in December, slightly more than the 1% forecast.

They also weighed the latest reading on the producer price index, which measures input costs from companies. The PPI showed a 0.5% decline for December. Economists surveyed by Dow Jones expected a 0.1% decline. That briefly gave relief to investors who have hoped for inflation to retreat and for the Federal Reserve to slow its rate-hiking campaign.

Investors have been enjoying strong upward momentum for stocks since the start of the year, although many have begun to doubt the market’s strength. The Dow is still higher by 1% for the month, while the S&P and Nasdaq are still up by 3% and 5%, respectively.

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Tesla, IBM, Alcoa and more

A general view shows the Tesla logo on the Gigafactory in Gruenheide near Berlin, Germany, August 30, 2022.

Annegret Hilse | Reuters

Check out the companies making headlines after hours.

Tesla — Shares dropped 3.7% after the electric vehicle maker reported third-quarter revenue that missed analyst expectations. Tesla reported earnings of $1.05 per share, compared with expectations of 99 cents adjusted earnings per share, according to analysts surveyed by Refinitiv. Revenue came in at $21.45 billion, less than the $21.96 billion expected.

IBM — Shares jumped 3.9% after IBM beat analyst expectations in its third-quarter earnings results and raised its full-year growth outlook. The tech company reported adjusted earnings of $1.81 per share, greater than the $1.77 per share expected by analysts, according to Refinitiv. Revenue came in at $14.11 billion, or more than the forecasted $13.51 billion.

Lam Research — The stock rose 2.1% after the semiconductor company surpassed profit and sales expectations in its most recent quarter. Lam Research reported adjusted earnings of $10.42 per share on revenue of $5.07 billion. Analysts expected earnings of $9.54 per share on revenue of $4.91 billion, according to Refinitiv.

Kinder Morgan — Shares fell 1.8% after the oil and gas pipeline operator reported third-quarter earnings results that fell short of earnings per share expectations, according to consensus estimates on FactSet. Kinder Morgan otherwise beat on revenue forecasts.

Alcoa — Shares dropped 6.9% after the aluminum producer reported a miss on third-quarter results, and lowered its 2022 shipment projections for alumina and bauxite. Alcoa reported a loss of 33 cents per share, compared to expectations of a gain of 8 cents per share, according to consensus estimates on FactSet. The company reported revenue of $2.85 billion, compared with expectations of $2.96 billion.

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Stock futures rise slightly after a rollercoaster week

Traders on the floor of the NYSE, Aug. 4, 2022.

Source: NYSE

Stock futures edged higher in overnight trading Sunday as investors awaited big earnings reports to roll in.

Futures on the Dow Jones Industrial Average gained about 50 points. S&P 500 futures and Nasdaq 100 futures both inched 0.3% higher.

The S&P 500 just came off its fourth negative week in five with a 1.6% loss last week. A hotter-than-expected inflation reading stoked wild price swings in the markets as investors readjusted their expectations for the Federal Reserve’s coming rate hikes.

“As inflation remains elevated for longer and the Fed hikes further, the risk increases that the cumulative effect of policy tightening pushes the U.S. economy into recession, undermining the outlook for corporate earnings,” Mark Haefele, CIO at UBS Global Wealth Management, said in a note.

Meanwhile, the third-quarter earnings season has kicked off. Investors are monitoring if corporate America will have any significant downward revisions to their outlooks in the face of stubbornly high inflation and the economic slowdown.

Bank of America is slated to report Monday before the bell, while Goldman Sachs will release numbers Tuesday morning. JPMorgan and Wells Fargo reported solid results last week, while Morgan Stanley’s equity trading revenue disappointed.

Many notable technology names are also reporting this week, including Netflix, Tesla and IBM. Johnson & Johnson, United Airlines, AT&T, Verizon and Procter & Gamble are other big companies on investors’ radar.

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IBM stock on pace for best day since April 2020 as estimates go higher

Wired senior staff writer Cade Metz and Arvind Krishna, IBM CEO and then senior vice president and director at IBM Research, speak onstage at the Wired Business Conference in New York on June 16, 2016.

Brian Ach | Wired | Getty Images

IBM shares rose as much as 8% on Wednesday after the hardware, software and consulting provider reported stronger-than-expected first-quarter results, inspiring analysts to raise price targets and estimates.

The 110-year-old technology company has become more favorable to investors this year as central banks have sought to combat inflation with higher interest rates. Although it’s not growing as fast as many of its enterprise software competitors, it generates income and continues to pay dividends, which can serve as a hedge against market uncertainty.

Executives said on Tuesday that it will cost more to add talent in the months to come, but the company plans to charge higher prices for consulting engagements. It also plans expects to bring out a new mainframe computer, which could help growth. Analysts polled by Refinitiv now see IBM growing 6% in 2022, up from under 4% last year.

“We’re incrementally more constructive after two consecutive Q’s of outperformance,” Morgan Stanley analyst Erik Woodring, who has the equivalent of a buy rating on IBM stock, wrote in a note to clients. The firm’s 12-month price target moved to $157 from $150, and it’s expecting IBM’s revenue to grow 5% in constant currency in 2022, compared with about 4% growth earlier.

Volatility and uncertainty are driving market conditions at the moment, and now that over half of IBM’s revenue is recurring rather than based on one-time transactions, it stands to perform better in the current environment than other hardware companies Morgan Stanley is tracking, Woodring wrote. That includes Apple, Dell Technologies, HP Inc. and Xerox.

Bank of America analysts led by Wamsi Mohan, with a buy rating on IBM stock, raised revenue and earnings expectations for 2022, 2023 and 2024. “With the benefits of the Mainframe cycle yet to accrue in 2022/2023, we view the portfolio as defensive (outperforms in a difficult macro environment) and expect sustained revenue growth beyond 2022,” they wrote.

Credit Suisse analysts Sami Badri and George Engroff, who also rate IBM stock as a buy, pushed up their estimates for this year and next year and increased their target price on IBM stock by $1 to $166.

Not everyone was feeling better about IBM after the report. Toni Sacconaghi Jr. of Bernstein Research, with the equivalent of a hold rating on IBM stock, mentioned in a note that while IBM raised its full-year expectations “modestly,” margins were narrower than expected, and any move higher could be temporary, because 2023 will be a more difficult year for the company.

WATCH: We don’t own IBM, but it’s not unreasonable, says Karen Firestone

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Jim Cramer says these 5 ‘old tech’ stocks could have a big year in 2022

CNBC’s Jim Cramer on Friday laid out an investment case for five legacy technology companies that he believes could post strong returns in 2022.

The “Mad Money” host said the following stocks fit within his main theme for the year, which is investing in profitable companies that produce tangible goods: Apple, Cisco, IBM, Microsoft and Oracle.

“While most of the money-losing cloud based software stocks are now off limits, there are plenty of tech names that make real things and generate real profits,” Cramer said, contending they can perform well despite the Federal Reserve’s tightening of monetary policy.

“What you want here are boring, mature companies—the kind that are often derisively referred to as ‘old tech,'” Cramer added. “I say out with the new, and in with the old.”

Apple

“Even with the stock’s 34% run last year … it’s now pulled back $10 from its highs earlier this week thanks to the tech meltdown. Whenever you get a buying opportunity like this with Apple, you’ve got to take it,” Cramer said.

Cramer said he believes Apple will benefit from pent-up demand that consumers can unleash once supply-chain issues subside. The iPhone maker’s “monster” share repurchase program is even more beneficial against the backdrop of a tightening Fed, Cramer said.

Cisco

Shares of Cisco have been strong since late November, Cramer said, as investors began to look past the company’s recent earnings reports.

“Those last two quarters weren’t bad because of demand. We’re actually seeing a surge in enterprise tech spending; the problem was the supply chain crisis,” said Cramer, who also touted the computer networking company’s move into software and the recurring revenue streams that accompany it.

“[Cisco CEO Chuck Robbins] says things should start turning in the second half of Cisco’s fiscal year, which starts February. I’m inclined to believe him because he’s a real straight-shooter,” Cramer said.

IBM

Cramer said he wouldn’t be surprised if IBM’s stock sells off when the company reports earnings in a couple weeks, but he holds a favorable view over the longer-term.

“I still like IBM for two very simple reasons: it’s incredibly cheap, selling for 12 times earnings, and even after the Kindryl spin-off, they’ve kept their pre-breakup dividend, which means the stock’s got a 4.9% yield,” Cramer said.

He also said he’s on board with CEO Arvind Krishna’s “mission to unlock value at any cost.”

Microsoft

“This one ran up about 51% last year, but thanks to the sell-off in recent weeks, you’re getting a very nice buying opportunity here. The stock’s down 10% from its late November highs. That usually doesn’t’ happen,” Cramer said. “Microsoft is exactly the kind of tangible tech story that should work when the Fed starts hitting the brakes to stop the economy.”

Oracle

Even after its breakout 2021, Cramer said he still thinks Oracle’s stock is cheap. The enterprise software giant’s most-recent quarter was fantastic, Cramer said. However, the stock has given up the gains it had post-report, due in part to Wall Street’s negative reaction to Oracle’s plans to buy electronic medical records company Cerner.

“This is another one where the recent pullback’s letting you in at an amazing price,” Cramer said.

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Disclosure: Cramer’s charitable trust owns shares of Microsoft, Apple and Cisco.

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Okta versus Deere is the best way to understand the market

CNBC’s Jim Cramer on Tuesday stressed to investors that Wall Street is going through a sector rotation, turning away from formerly high-flying growth stocks in anticipation of tighter monetary policy.

To illustrate his point, the “Mad Money” host pointed to recent trading in shares of identity management software firm Okta and agriculture giant Deere.

“Okta versus Deere is the best way to understand this market,” Cramer said. ‘”At this point in the business cycle, the playbook says you have to go with more tangible companies that make real things and generate real profits. … Conceptual is out, tangible is in,” he added.

A year ago, Cramer said investors were willing to pay up for Okta’s strong revenue growth even as the company remained unprofitable. However, now money managers are reacting to high inflation readings and preparing for likely interest rate hikes from the Federal Reserve, Cramer said.

Cramer said that shift helps explain why Okta shares are down 4% over the past five days, while Deere is up 6.2% in that same stretch.

“I don’t mean to pick on Okta. We all know anything can bounce. There are literally dozens upon dozens of these nosebleed valuation stocks; Okta’s just among the best of them,” Cramer said. “At the moment, though, that makes it the best house in an awful neighborhood.”

By contrast, Cramer said he expects the market to be very forgiving toward stocks such as Deere, Boeing and Honeywell. Banks, which benefit from higher interest rates, are also in favor at the moment, he said.

“It’s not as simple as tech versus non-tech. There are plenty of cheap, tangible tech stocks out there” such as IBM and Hewlett Packard Enterprise, Cramer said. “Again, though, these are easily valued businesses that have a John Deere-like feel, and that’s what you need.”

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MongoDB shares jump as revenue growth accelerates

Dev Ittycheria, CEO of MongoDB

Adam Jeffery | CNBC

Shares of database software maker MongoDB were up as much as 18% in extended trading on Monday after issuing fiscal third-quarter results.

Here’s how the company did:

  • Earnings: Loss of 11 cents per share, adjusted, vs. a loss of 38 cents per share as expected by analysts, according to Refinitiv.
  • Revenue: $226.9 million, vs. $205.2 million as expected by analysts, according to Refinitiv.

Revenue grew 50% year over year in the quarter that ended Oct. 31, compared with 44% growth in the prior quarter, according to a statement. Revenue from the company’s Atlas cloud database service grew 84%, compared with 83% growth in the previous quarter.

But the company’s total net loss widened to $81.3 million from $72.7 million in the year-ago quarter, with sales and marketing expenses totaling more than half of quarterly revenue. Competitors include top cloud providers such as Amazon and Microsoft, as well as database incumbents such as IBM and Oracle.

MongoDB raised its guidance for the full 2022 fiscal year. It now expects an adjusted net loss per share of 74 cents to 71 cents on $846.3 million to $849.3 million in revenue, compared with a loss of $1.20 to $1.13 on $805.0 million to $811.0 million in revenue. Analysts had expected a loss of $1.13 per share and $813.0 million in revenue.

Travel, events and other business expenses came in lower than the company had predicted as the Covid pandemic continued during the quarter, Michael Gordon, MongoDB’s operating and finance chief, said on a conference call with analysts.

Many large Atlas cloud customers renewed contracts early, boosting deferred revenue in the quarter, Gordon said.

Coinbase is moving more workloads to the Atlas service, said MongoDB CEO Dev Ittycheria. The cryptocurrency exchange operator had “some pretty unique requirements when it comes to performance and scale,” he said. “As you can imagine, in their market, they have a lot of periods where they have some intense trading days.”

WATCH: MongoDB CTO on software company benefits, remote and hybrid work solutions

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Federal contractors will have broad flexibility to enforce Covid vaccine rules

Pilots talk as they look at the tail of an American Airlines aircraft at Dallas-Ft Worth International Airport.

Mike Stone | Reuters

Federal contractors will have broad leeway to enforce President Joe Biden’s Covid-19 vaccine mandate, according to new guidance the White House released Monday, laying out details on implementation of the rules.

Under the new guidance, federal contractors from IBM and Boeing to food service providers will have flexibility to determine how they enforce the vaccination requirements for workers who refuse to be vaccinated.

“A covered contractor should determine the appropriate means of enforcement with respect to its employee at a covered contractor workplace who refuses to be vaccinated and has not been provided, or does not have a pending request for, an accommodation,” said the guidelines, which affect millions of workers.

The federal contractor guidelines are stricter than the forthcoming vaccine mandate for businesses with 100 or more employees, which allow for regular testing broadly as an alternative to a vaccine. The Labor Department is still finalizing those rules. Businesses have asked for that mandate to be delayed until after the holiday season over concerns about possible supply chain disruptions.

U.S. President Joe Biden answers questions from the media in the State Dining Room at the White House in Washington, U.S., September 24, 2021.

Evelyn Hockstein | Reuters

The White House released the federal contractor guidance Monday after contractors sought more details on how to implement the rules. Biden issued an executive order on Sept. 9 requiring federal contractors to ensure their employees are vaccinated against Covid-19 and follow masking and social distancing policies. The administration set a Dec. 8 deadline for contractors to implement those requirements.

Senior administration officials made clear that Dec. 8 is not a hard deadline for contractors to have all of their employees fully vaccinated. Instead, contractors must demonstrate they are making a good faith effort to ensure employees are getting vaccinated and have plans in place to ensure masking and social distancing policies are followed in the workplace.

Federal contractors won’t have to show proof of vaccination rates at the deadline, a senior administration official said. But noncompliance could result in the loss of a federal contract.

Federal agencies could bar a contractor employee who refuses to be vaccinated from entering a federal workplace, according to the guidelines.

“In most circumstances individuals who are not fully vaccinated need to follow applicable masking, physical distancing, and testing protocols,” the guidelines said.

The federal government will defer to contractors to determine when an employee has a sincerely held religious belief or medical condition that requires accommodation, according to senior administration officials. Federal contractors are not required to make a final determination on accommodation requests when an employee begins work.

“The covered contractor may still be reviewing requests for accommodation as of the time that covered contractor employees begin work on a covered contract or at a covered workplace,” the guidelines said.

However, federal contractors must require employees with pending accommodation requests to abide by policies on masking and social distancing while their requests are under review, according to the guidelines.

Federal contractors including some large airlines such as Southwest and American, and aerospace giant Boeing, have said employees must be vaccinated by the Dec. 8 deadline or apply for an exemption.

Some labor groups have opposed the mandate, including pilots’ unions at American and Southwest. The latter sought to bar the implementation of the mandate, a request a federal judge in Texas denied last week.

American and Southwest executives have softened their tone over the mandate, urging employees to apply for religious or medical exemptions if they don’t plan to get the vaccine, and said they don’t expect to terminate employees over it. Southwest last month dropped a plan to put workers with pending exemption requests on unpaid leave. Airline executives said they don’t foresee the mandate impacting flights over the holidays.

Eleven Republican-led states sued the administration on Friday, arguing the vaccine mandate is unconstitutional. The administration has made clear that the requirements supersede any state laws that bar compliance with Covid-19 mitigation policies.

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