Hot Stock Minute

Worst Month for Dow Industrials Since May 2012; Salesforce.com and Splunk Soar

Hot Stock Minute

August has proven to be a summer slam for stocks, with the Dow Jones Industrial Average having its biggest monthly decline since May 2012. The indexes moved lower on fears of an impending Fed taper, lackluster earnings, and more recently the prospect of U.S military intervention in Syria. Among the economic numbers released as we ended the month was consumer spending for July. The Commerce Department says the figure ticked up 0.1% when expectations were for 0.3%. Meanwhile, the Thomson Reuters/University of Michigan's final reading on consumer sentiment for August registered at 81.2, down from 85.1 in July. Still, that reading topped an earlier estimate for August of 80.

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Salesforce.com (CRM) climbed more than 12% on its quarterly report. Earnings for the cloud-computing company came in at 9-cents a share versus expectations of 7-cents. Revenue also beat by almost $20-million at $957.1-million. Salesforce has been expanding from its core business of customer-management software into marketing tools, which includes the recent acquisition of ExactTarget for $2.5-billion. Prior to today shares were up just 2% in 2013.

Big data software firm Splunk (SPLK) soared more than 12% on its earnings. The company reported a loss for the quarter after yesterday's close, but it was less than expected at a penny a share. Analysts had been looking for losses of 3-cents. Sales also beat expectations at $66.9-million versus estimates of $63-million. Even prior to these gains, shares were up 67% year-to-date.

Krispy Kreme (KKD) plunged more than 15% today on disappointing earnings. They came in 2-cents short at 14-cents a share excluding items. Revenue was also below expectations at $112.7-million versus $114.91-million. Sales at stores open at least a year rose 10% in the quarter, and the chain reaffirmed its full-year earnings forecast; however, growth appears to be slowing.

OmniVision Technology (OVTI) plunged more than 16% today despite a solid beat on the bottom line. Omnivision makes image sensors used in everything from cell phones and webcams to cars and medical imaging equipment. The company made 55-cents a share, 12-cents better than estimates. The problem was the topline where sales of $373.7-million missed the mark by about $3-million due to increased competition in the phone space. Prior to the fall we saw today, this stock had been up 24% year-to-date.

Big Lots (BIG) rose more than 2% despite a lowered outlook on a robust earnings beat. The discount retailer reported net income of 31-cents a share excluding items when estimates were for 25-cents. Revenue was right on target at $1.23-billion. The company revised its guidance down citing weaker sales.

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