10:04 am Consumer Discretionary Index -1.22%The consumer discretionary group is in-line with the broader market in early trade. The retail group is also in the red with the Retail HOLDRS Trust (RTH) -0.8% and the SPDR S&P Retail ETF (XRT) -0.4%. Trading higher following earnings/guidance: PSUN +9.9%, PLCE +5.3%, SPTN +4.6%, VVTV +3.4%, PETM +2.2%, GME +1.4%, GAME +1.3%, SMRT +1.2%... Trading lower following earnings/guidance: BKE -5.4%, PERY -4.6%, RL -3.7%, SIG -3.1%, GMAN -2.4%, HRL -1.3%, BONT -0.7%, AAP -0.6%, KIRK -0.4%.. Near unchanged mark following earnings/guidance: CATO, LTD Other notable mentions: Leaders: SKS 0.7% (Saks M&A speculation continues; Bloomberg.com report out last night suggested KKR may be looking to Saks/Neiman merger), HTSI 0.2% (Harris Teeter Supermarkets ticking higher premarket; hearing continued PE speculation as catalyst , RUE 22.9% (rue21 enters into definitive agreement to be acquired by funds advised by apax Partners for $42.00/share in cash ), KOF 0.6% ( announces 10 year bond issuance in Mexican market)... Laggards: JCP -1.2% ( announces consummation of $2.25 bln term loan and initial settlement of its tender offer and consent solicitation ), WMT -0.6% (NYTimes discusses retail risks from new safety plans in Bangladesh, according to reports), F -2.3% (plans shut down two manufacturing plans in Australia following higher costs, according to reports). Analyst related: Upgrades: HOT -0.3% ( upgraded to Overweight from Equal-Weight at Morgan Stanley, upgraded to Buy from Neutral at BofA/Merrill)... Misc: WYN -0.8% and VAC -0.4% (initiated with a Buy at Stifel), CHH -1.6% and H -1.5% (initiated with a Hold at Stifel), CMG -1.9% (resumed with a Neutral at Credit Suisse ),
08:45 am Claims Fall Back Below 350,000After a one-week shock, the initial claims level dropped back below 350,000. The initial claims level fell to 340,000 for the week ending May 18 from an upwardly revised 363,000 (from 360,000) for the week ending May 11. The Briefing.com consensus expected the initial claims level to fall to 348,000. As we expected, the increase in claims last week seems to have been the result of normal week-to-week movements of a highly volatile data series. The jump, which brought the initial claims level to its highest point since February (excluding the biases from the Easter holiday), was not a change in trends. Layoff levels have stabilized. The continuing claims level decreased from an upwardly revised 3.024 mln (from 3.009 mln) for the week ending May 4 to 2.912 mln for the week ending May 11. The consensus expected the continuing claims level to fall modestly to 3.005 mln.
07:53 am Dryships shares fall 6% following in line earningsDryShips (DRYS $1.95 -0.14) reported first quarter loss of $0.10 per share, excluding non-recurring items, in-line with the Capital IQ consensus of ($0.10), while revenues rose 29.2% year/year to $319.7 mln versus the $315.25 mln consensus. "During Q1 of 2013, we entered into agreements to sell four of our bulk carriers under construction in China. We did not have any bank financing in place for these vessels. Under the terms of the sale agreements, we will make payments of only $29 mln, effectively eliminating $149 mln in capital expenditures. We have now reduced our newbuilding program to six bulk carriers, two of which are scheduled for delivery in 2013, for which we have time charters and bank financing in place, and four of which are scheduled for delivery in 2014, for which we are considering our options. Now that our unfunded capital expenditures have been reduced significantly, we are in discussions with our lenders to lower our debt service requirement. These developments are expected to reduce our cash outflow and lower our cash breakeven levels." "Even though there has been a recent spike in some drybulk charter rates, we continue to be defensive about the short-term prospects of the shipping markets. Asset prices seem to be holding up but we do not expect any positive sustainable development in charter rates this year. We are a pure shipping co with spot market exposure and a shareholding in Ocean Rig. Ocean Rig's capital and resources are completely separated from those of DryShips. We continue to be bullish about the prospects for Ocean Rig, whose contract backlog currently stands at ~$4.9 billion over three years."
07:50 am Synopsys shares little changed following beat on earnings and downside guidanceSynopsys (SNPS $35.63 +0.23) reported second quarter earnings of $0.66 per share, excluding non-recurring items, $0.03 better than the Capital IQ consensus of $0.63, while revenues rose 15.4% year/year to $499.3 million versus the $496.27 million consensus. The company issued downside guidance for the third quarter with EPS of $0.53-$0.55, excluding non-recurring items, versus the $0.57 Capital IQ consensus and revenues of $475-$485 million versus the$495.85 million Capital IQ consensus. The company issued in-line guidance for fiscal year 2013 with EPS $2.37-$2.42, excluding non-recurring items, versus the $2.40 Capital IQ consensus with revenues of $1.955-$1.975 billion versus the $1.97 billion Capital IQ Consensus Estimate.
07:47 am Pacific Sunwear shares soar 19% following beat on earningsPacific Sunwear (PSUN $3.49 +0.57) repotted first quarter loss of $0.14 per share, excluding non-recurring items, $0.05 better than the Capital IQ consensus of ($0.19), while revenues rose 4.6% year/year to $169.8 million versus the $164.04 million consensus. Comparable store sales for the first quarter of fiscal 2013 increased 2%. The company issued guidance for the second quarter with EPS of ($0.05) - $0.02, excluding non-recurring items, versus the ($0.04) Capital IQ Consensus Estimate; sees Q2 revs of $209-219 million versus the $198.45 million Capital IQ consensus. "After a slower than expected start to the spring selling season, we are pleased with our overall first quarter performance which was led by strength in our women's business...This marks our fifth consecutive quarter of positive comps since affecting our real estate restructuring at the end of fiscal 2011. We believe our results continue to validate our core turnaround strategies tied to great brands, on-trend merchandising and re-establishing PacSun's distinct identity through the creativity, diversity and optimism of the California lifestyle." Q2 Guidance Metrics: Comparable store sales from flat to 5%. Gross margin rate, including buying, distribution and occupancy, of 28% to 30% In fiscal 2011, as a result of the issuance of the Series B Preferred in connection with the Company's $60 million senior secured term loan financing with an affiliate of Golden Gate Capital, the Company recorded a derivative liability equal to ~$15.0 million, which represents the fair value of the Series B Preferred upon issuance.
07:46 am Hewlett Packard shares soar 12% following beat on earnings and upside guidanceHewlett-Packard (HPQ $23.94 +2.71) reported second quarter earnings of $0.87 per share, excluding non-recurring items, $0.06 better than the Capital IQ consensus of $0.81, while revenues fell 10.1% year/year to $27.58 billion versus the $28.03 billion consensus. Upside was "driven by better than expected performance in Enterprise Services and Printing, coupled with the accelerated capture of restructuring savings and improvement in our operations." HP generated $3.6 billion in cash flow from operations in the second quarter, up 44% from the prior-year period. Inventory ended the quarter at $6.0 billion, down 2 days YoY to 26 days. HP utilized $797 million of cash during the quarter to repurchase ~36.3 million shares of common stock in the open market. HP exited the quarter with $13.6 billion in gross cash. The company issued upside guidance for the third quarter with EPS of $0.84-0.87, excluding non-recurring items, versus the $0.83 Capital IQ consensus. The company issued upside guidance for fiscal year 2013 with raised EPS to $3.50-3.60, excluding non-recurring items, from $3.40-3.60 versus the $3.45 Capital IQ consensus. HP also today announced that the HP board of directors has declared a regular cash dividend of 14.52 cents per share on the company's common stock, which, as previously announced, reflects a 10% increase in amount compared to the previous quarterly dividend amount.
07:44 am Workday shares little changed following better than expected earningsWorkday (WDAY $68.00 +2.25) reported a first quarter loss of $0.15 per share, $0.03 better than the Capital IQ consensus of ($0.18), while revenues rose 61.3% year/year to $91.6 million versus the $86.65 million consensus. Q1 subscription revs of $68.4 million above guidance of $64-66 million. The company issued in-line guidance for the second quarter with revenues of $97-101 million versus the $98.81 million Capital IQ consensus. The company issued guidance for fiscal year 2014 with raised revenues to $425-440 million from $420-435 million versus the $436.40 million Capital IQ consensus.
03:56 am Dollar Tree among the cos set to report pre-market on a retail heavy earnings Thursday (DLTR)
Look for the following companies to report before the open:
03:55 am Hewlett-Packard spike higher after hours follwoing earnings (HPQ)After Hours Gainers: