Breakout

Google gashed; IBM getting hit; Goldman shining

Jeff Macke
Breakout

Making the list today as measured by your Yahoo Finance Ticker searches are...

Goldman Sachs (GS): The vampire squids crushing it on earnings, sending the stock higher today. Lloyd's boys were able to beat street estimates due to strong investment banking and investment management results. Despite today's bounce, being Masters of the Universe doesn't pay as well as it used to; Goldman's shares are down some 20% for the year. Even today's rally is tainted by the fact that net income actually shrank year over year. More humiliating still, Goldman actually resorted to cutting compensation to help goose the numbers.

IBM (IBM): Big Blue getting hit by as much as 4% as a revenue miss has investors dumping shares. Hardware, software and services all came in light resulting in IBM's 8th straight quarter of falling revenue. IBM is touting its move into the cloud but refuses to break out specifics. In the meantime, what IBM does best is buy shares of its own stock. Big blue spent $8.2 billion on buybacks just last quarter. Between repurchases and dividends, IBM's cash on hand is shrinking while the stock stays flat. Right about now shareholders would seem to prefer more attention be paid to growing the company.

Then again, Google (GOOGL) buys just about everything but its own shares, and that stock is getting hit just as hard as IBM. The Silicon Valley stalwart is facing its own business model problem as customers switch from desktop to mobile advertising. Google's getting its share of clicks, but the mobile ads simply don't command the same prices and it's hitting Google's margins. Sergey and Larry can't be accused of sitting on their hands while the industry shifts, the company has been betting on everything from fire detectors to drones in its neverending quest to know you better than you know yourself.

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