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Google Soaring to New High; GE & MS Report; New Bid for BlackBerry; SAC Settlement?

Dan Berman
Hot Stock Minute
Google Soaring to New High; GE & MS Report; New Bid for BlackBerry; SAC Settlement?

Futures are higher as we end a wild week from Washington to Wall Street. But the story of the hour is Google (GOOG). Shares have been up nearly 10% in the premarket. The climb comes on the heels of the company's earnings which were released after yesterday's closing bell. So, what exactly did Google report that has investors going gaga? Yahoo Finance Senior Columnist Mike Santoli has more in the video above.

GE (GE) and Morgan Stanley (MS) both reported earnings this morning. GE beat on the bottom line with earnings of 36-cents a share versus expectations for 35-cents. However, it missed on revenue which came in at $35.7-billion compared to a consensus figure of $35.955-billion. As for Morgan Stanley it beat on both earnings and revenues. Profits were 44-cents a share compared to estimates of 40-cents. Sales were $8.10-billion versus $7.70-billion.

Now that there's a short-term debt deal in place and the government has reopened, talk of a Fed taper is back on the table. The Fed's first chance for a scale-back in its bond-buying will come at the next policy meeting on October 29th and 30th. The two meetings after that will occur in Mid-December and at the end of January. Right now an October taper seems unlikely. But it could hinge on the September jobs report which will now be released on Tuesday. The October report will be released November 8th.

SAC may be on the verge of a record-breaking settlement with the Feds. There are several reports, the hedge fund has agreed in principal on a deal to end criminal charges of insider trading. SAC would pay fines between $1.2 and $1.4-billion, the largest amount ever for an insider trading case. To this point, the fund's founder Stephen A. Cohen has not been accused of criminal wrongdoing. But any settlement with the company would not preclude future charges against him.

BlackBerry (BBRY) may have another bidder. The Wall Street Journal says China's Lenovo is actively considering a takeover. Lenovo was late to the smart-phone game, but currently sells more of the devices than BlackBerry. Shares of BlackBerry spiked yesterday afternoon on news of Lenovo's interest. However, they're still down 21% over the past month.


Google (GOOG) appears to be lifting other growth stocks higher. Facebook (FB) is up nearly 4% in the premarket to a new all-time high near $54. Amazon (AMZN) is also rising, and testing its all-time high. As for Google's numbers, it beat on both the top and bottom lines with earnings of $10.74 a share versus estimates of $10.34. Revenues hit $14.89-billion, $100-million ahead of estimates.

Chipotle (CMG) has been up nearly 8% to an all-time high in the premarket on its earnings which were released yesterday afternoon.The company actually missed on the bottom line with earnings of $2.66 versus expectations for $2.87. But sales topped the consensus. Chipotle reported better same store sales than expected. It also hinted at price increases sometime next year.

Not every company is climbing on earnings. AMD (AMD) has been down more than 10% in the premarket, despite beating estimates. The chipmaker made 4-cents a share for the quarter, twice what was expected. Sales also beat at $1.46-billion. AMD's problem: the company says don't expect a giant boost in business from the new crop of gaming consoles about to hit the market. The drop could also reflect an excessive run-up so far this year. Shares had climbed 62% before this fall.

Intuitive Surgical (ISRG) which has been down more than 7% on its earnings.This is the maker of the Da Vinci robot used in operating rooms. The company says it sold 101 of the machines in the quarter, down almost 50% from a year ago. Intuitive did in fact miss revenue estimates with sales that fell under $500-million when estimates were for $526-million. Still it managed to sail past earnings estimates at $3.99 a share compared to $3.40. Even before this morning's drop, Intuitive shares were down 20% this year.