Some real heavyweights reported earnings after the bell Wednesday and all were battered in the aftermarket. I must say that I'm a little confused by the initial reactions, which underscore the hostile mood of investors.
Oracle (ORCL): the company achieved sales of $7.24 billion and earnings per share (ex items) of $0.47; the street was looking for $6.88 billion and $0.44 per share, respectively. The company is enjoying strong sales around the world, and the Americas region was up 18% which was really impressive. I guess investors had a problem with guidance. The company is looking for earnings per share of $0.26 to $0.27 on revenue of $5.42 to $5.51 billion (this is generally the weakest quarter of the year); Wall Street came into yesterday looking for earnings of $0.27 per share on $5.37 billion in revenue.
Research in Motion (RIMM): the company missed the consensus estimates on the top and bottom lines when it posted results last night. Earnings missed by $0.01, and revenue of $2.24 billion came in below the street estimate of $2.27 billion. What is more worrisome, and what drove the stock significantly lower, was the guidance. The company expects earnings of $0.84 per share versus the previous street consensus of $0.92 per share. There were a couple of positives, including subscriber growth of 2.3 million versus the estimate of 2.2 million, and IDC saying the company's advance phone share climbed to 44.5% from 35.1% (Palm's share leaped to 13.4% from 7.0% while Apple's tumbled to 19.2% from 26.7%).
Nike (NKE): the company beat on the top and bottom lines and saw growth around the world except at home. U.S. sales were unchanged, but EMEA climbed 10% and Asia/Pacific, led by China, exploded by 31%. I must say that there is something in the realm of karma that the Chinese can now afford real Nike products. I must say to the West pay attention as this is just like an Indian company buying Jaguar, once the crown jewel of British industry. I guess weak domestic sales were why investors were fleeing the stock after hours.
Bed Bath and Beyond (BBBY): the stock was up big in the aftermarket, go figure. Yes the company beat the consensus earnings estimate by $0.03, posting earnings of $0.30 per share. Revenue of $1.65 billion was also ahead of expectations of $1.62 billion. The company was able to eek out same-store sales gains, albeit it, only 0.8% higher. Still, management says that it's taking market share in this tough environment, and that is the stuff that once made this a Wall Street darling.
Written by Charles Payne, CEO and Principal Analyst of Wall Street Strategies (www.wstreet.com) providing information to over 50,000 subscribers. Charles is a regular contributor to the Fox Business and Fox News Networks.
Disclosure: none
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