A flood of big-name earnings reports came in this morning and after the close yesterday in what will be the busiest day yet for the first quarter earnings season. Six Dow components reported, plus Google, Mattel, Chipotle and Pepsi.
The headliners this morning were Goldman Sachs (GS) and Morgan Stanley (MS), both of which reported better-than-expected earnings. Goldman Sachs beat earnings-per-share estimates handily, coming in at $4.02 a share versus expectations of $3.45 a share. Revenue was up nearly 10% over last year. Morgan Stanley, meanwhile, also beat earnings and revenue estimates. Revenue was up nearly 4% year over year. The company also doubled its dividend to $0.10 a share.
In addition to Goldman Sachs, five other Dow components have reported since the markets closed yesterday. American Express (AXP) beat earnings-per-share estimates, but missed revenue as customers spent less on their cards than they did a year ago. IBM (IBM) also disappointed investors, reporting its lowest quarterly revenue total in five years, with first quarter revenue down 4%. Earnings per share were in-line with estimates. IBM has been struggling to shift its business toward new technologies like cloud computing and away from its traditional hardware business. General Electric (GE) reported better-than-expected earnings. UnitedHealth (UNH) missed Wall Street targets. And DuPont (DD) said revenue fell 3% due to the severe weather impact on crops.
Google (GOOGL) also missed after the bell yesterday. The company reported earnings per share of $6.27 on estimates of $6.40. Revenue rose 19%, but missed analysts' estimates. Google's ad volume rose 26% last quarter, but ad revenue dropped 9%, as more users turn to mobile devices where advertising tends to pay less. Infrastructure costs rose, as did operating expenses related to the acquisition of connected-home company Nest Labs.
Barbie is out of fashion. Mattel (MAT) swung to a loss for the quarter, dragged down by a 14% decline in Barbie sales. Its wheels business, including Hot Wheels and Matchbox fared better, but was still down 2%.
And Chipotle Mexican Grill (CMG) easily beat revenue estimates as the burrito chain saw stronger restaurant traffic, but the company missed on earnings. Chipotle also raised its same store sales growth projections for the year.
Meanwhile, China's version of Twitter, Weibo (WB) begins trading today. It raised $286 million, less than expected and priced its IPO at $17, near the low end of the range. That values the company at $3.46 billion. Weibo is owned by Chinese web portal Sina (SINA).
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- Goldman Sachs
- Morgan Stanley