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Taper Trepidation Takes Hold; TWX & AOL Report; Disney’s Drop on Flop

Dan Berman
Hot Stock Minute
Taper Trepidation Takes Hold; TWX & AOL Report; Disney’s Drop on Flop

Futures are down again this morning on taper trepidation. Stocks swooned yesterday after Chicago Fed Pres Charles Evans said the bank was likely to scale back its bond buying by year's end. The Dow ended the day down 93-points and the S&P slipped back below 1,700. Now the indexes are poised to move lower as two more Fed Presidents prepare to speak today. So, what should we be expecting in the remarks? Yahoo! Finance Senior Columnist Mike Santoli has more int he video above.

There were two beats this morning from a pair of companies which used to be one. We're talking Time Warner (TWX) and AOL (AOL). Time Warner made 81-cents a share, a nickel better than expectations. Revenue also beat at $7.44-billion. AOL posted profits of 35-cents a share, 3-cents above the consensus. Revenue also edged past estimates at $541.3-million.

Disney (DIS) revealed a mixed quarter when it released earnings yesterday afternoon. The company posted profits of $1.03 a share beating estimates of $1.01. However, revenue was slightly below the consensus at $11.58-billion. Little surprise: the big flop known as the Lone Ranger was a weight on the entire corporation. In fact the company plans to take a $190-million loss for the movie. But those losses there were counterbalanced by increased revenue from ESPN and the company's theme parks. Disney shares have been down nearly 2% in extended trading. At yesterday's close they were up about 31% year-to-date.

There's double trouble for Bank of America (BAC). Both the Justice Department and the SEC have filed civil suits against the company, claiming it defrauded investors. At issue: $850-million worth of mortgage backed securities sold in 2008. The Feds say BofA understated the risks associated with the products. The bank says it shouldn't be blamed for the collapse of the housing market.


Tesla (TSLA) reports after today's closing bell. Analysts expect the company to post a loss of 17-cents a share, much improved from a year ago when they were 89-cents a share. Revenue is expected to grow nearly $1,350% to $383-million. According to one calculation, the company delivered 1,400 of its Model S sedans in July. Not bad, but Tesla is facing increased competition, now with BMW rolling out an electric vehicle. Tesla shares have climbed 302-% since the start of the year and hit a new intraday high yesterday. Right now the company has a market cap of more than $17-billion making it a-quarter the size of Ford.

Groupon (GRPN) also reports after the closing bell. The company is expected to post earnings of just 2-cents a share, down from 8-cents this time last year. Revenue is estimated to have grown 7% to about $606-million. One analyst at Sterne Agee said yesterday that investors are underestimating Groupon's growth potential particularly through mobile. But keep in mind, the company has been under the watch of two interim co-CEOs since founder Andrew Mason made his high publicized departure back in March. Shares of Groupon are up 75% year-to-date. However, they're down just about two-thirds since the company went public in November 2011.

First Solar (FSLR) which has been down more than 8% in early trading following the release of a dismal earnings report yesterday afternoon. First Solar made 39-cents a share when estimates were for 56-cents. Revenue was also sorely short, under $520-million when expectations were for close to $730-million. The company also lowered its full year guidance on both earnings and revenues. Until now shares of First Solar had been up 46% in 2013. ((FS)) Even more impressive, they've been up 126% over the past year.

Zillow (Z) is down 8% in the wake of its earnings report. The company posted losses of 30-cents a share, more severe than the expectations which were for minus 11-cents. Though revenue beat expectations by about 5% at $46.9-million. Prior to this morning's drop, Zillow shares were up 220% so far this year.

By the way a programming note: Zillow will be hosting a question and answer session today with President Obama on housing, and Yahoo will be streaming it live. To submit a question to President Obama, or to watch the event live, go to homes.yahoo.com. The streaming session will begin at 1pm eastern time.