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ECB Cuts Rates; Jobless Claims Plummet; Facebook Brings Smiles

Dan Berman
Hot Stock Minute
ECB Cuts Rates; Jobless Claims Plummet; Facebook Brings Smiles

The number of weekly jobless claims has taken an unexpected drop. The Labor Department says there were just 324,000 new claims last week. That's down from 339,000 last week and handily beats the consensus which was for 345,000. Tomorrow is the government's monthly jobs report. Tune in live at 8:30 Eastern for a special expanded show.

GM (GM) has blown-out estimates with earnings, which it released in just the past hour. The biggest of the American automakers posted 67-cents a share, well ahead of estimates for 54-cents. It also beat on revenues. Cigna (CI) also beat big-time this morning. The insurer says profit rose 39% in the quarter to $1.72 a share. Revenue also beat by more than $1/2 billion. Beazer Homes (BZH), on the other hand missed terribly. It lost 78-cents a share when estimates were for 70-cents. Revenue also missed.

Facebook (FB) shares have been moving about 1.5% higher in reaction to the company's earnings report which was released yesterday afternoon. Earnings missed by a penny, but the real story here was the beat on revenue, which came in at nearly $1.5 billion and were up 38% since last year. Some of the key stats: 30% of Facebook's revenue resulted from mobile advertising, which is often listed as the company's biggest hurdle. That's a jump from 23% in the prior quarter, highlighting how fast the shift is happening. The company says 2/3 of its members now log-in using mobile devices. The social network is having particular success with ads for mobile apps. It says the ads drove 25-million downloads of apps in the quarter.


Shares of Yelp (YELP) have been surging 9% in reaction to its earnings report. Yelp impressed investors even though it lost 8-cents a share; consensus was for minus 6-cents. Key here were better-than-expected revenues. They rose 68% from a year ago. Yelp is also improving its outlook for the year citing success with display ads on mobile phones-- something it seems to have in common with Facebook. Shares are now up more than 35% since the start of the year.

Next is Energizer (ENR), the parent company of Schick razors and related products. The stock has been trading lower despite beating estimates with its earnings, posting $1.35 a share on $1.1 billion in revenue. The problem here: the company claims its sales are hurting because rival Proctor and Gamble (PG) has been bombarding customers with promotions on its Gilette products. By the way Church and Dwight (CHD), the maker of Arm and Hammer says PG has been pulling similar stunts in the laundry aisle. But Church and Dwight is out with earnings this morning and says profits climbed 15%.

Now we look at Advanced Micro Devices (AMD) which closed up 14% yesterday. The climb came after Barron's reignited speculation that Intel could buy the chip maker. The paper also said Microsoft may be using AMD processors for its latest X-box which is expected to be announced later this month. The rise put AMD shares at their highest point since October, though they're still worth less than half of what they were a year ago. And if you go all the way back to the internet bubble there were two periods when they topped $40 apiece.

Finally, we're sticking with computers, and looking at IBM (IBM). Big Blue's effort to sell part of its server business appears to have broken down. The company had been in talks with China's Lenovo, but sources say the sides couldn't come to terms on a price. Lenovo confirmed last month that it was in talks with IBM and an unnamed third party. IBM took a bit of a dip in the past few weeks, but it still up slightly since the start of the year.