Seeking Alpha
  • Today - Thursday, April 24, 2014

  • 1:21 PM
    • The iShares DJ U.S. Home Construction ETF (ITB +2.7%) gains as earnings roll in from D.R. Horton, PulteGroup, Ryland, and M/I Homes. While PulteGroup saw slowdowns in closings and new orders, but offsetting increases in prices, D.R. Horton reported sales, new orders, and prices all on the rise. DHI is ahead 8%, Pulte 3%, Ryland (RYL +2.2%), M/I Homes (MHO +5.9%).
    • The SPDR S&P Homebuilders ETF (XHB +1.2%) is more of a homebuilding supply play.
    • Other builders: NVR (NVR +3.4%), Lennar (LEN +3.5%) Standard Pacific (SPF +2.8%), M.D.C. Holdings (MDC +3.2%), Hovnanian (HOV +2.5%), Toll Bros (TOL +4.2%).
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  • 1:10 PM
    • FQ2 net income of $131M or $0.38 per share is up 18% from a year ago. Revenue of $1.7B is up 22%. Homes closed of 6,194 is up 10%. Average sales price up 10%.
    • Net sales orders during Q of 8,569 up 9% Y/Y; value of net sales orders of $2.4B up 20%. Cancellation rate of 19%. Backlog of 10,059 homes up 5%; value of backlog of $2.8B up 18%.
    • Source: Press Release
    • Previously: D. R. Horton beats by $0.04, beats on revenue
    • DHI +8.3%
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  • 1:08 PM
    • Re/code reports Amazon (AMZN +3.5%) is paying HBO (TWX +0.1%) $300M over three years for its streaming deal. While steep, that figure is less than many estimated, particularly given the cost of Amazon's deals with Viacom and Epix.
    • The Amazon/HBO deal covers many of HBO's biggest hits, including The Sopranos, The Wire, and Six Feet Under, Boardwalk Empire, and True Blood. (early seasons for the last two). But it doesn't cover HBO's biggest current hit (Game of Thrones).
    • Separtely, Amazon has launched Prime Pantry, its latest salvo at supermarkets and Wal-Mart/Target's grocery ops. Prime Pantry allows Prime subs in the continental U.S. to have up to 45 pounds of groceries shipped for a flat fee of $6. It arrives as Amazon gradually expands the reach of its AmazonFresh same-day delivery service.
    • Shares are up strongly ahead of today's Q1 report. Recent ChannelAdvisor data has been encouraging, a sales tax survey less so.
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  • 1:01 PM
    • Dime Community Bancshares, Inc. (DCOM) declares $0.14/share quarterly dividend, in line with previous.
    • Forward yield 3.36%
    • Payable May 13; for shareholders of record May 6; ex-div May 2.
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  • 1:00 PM
    • Dow +0.17%.
    • 10-yr -0.1%.
    • Euro +0.05% vs. dollar.
    • Crude +0.59% to $102.04.
    • Gold +0.45% to $1290.4.
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  • 12:58 PM
    • Russia's Gazprom (OGZPY) has billed Ukraine's Naftogaz $11.4B for not importing the full amount of natural gas under a 2013 supply contract, adding pressure on the Ukraine government as the prospect of supply cuts looms.
    • Ukraine's ballooning debt could give Moscow the right to demand an early repayment of a loan, which could theoretically cause a domino effect on ~$20B of Ukraine sovereign and quasi-sovereign debt.
    • The latest figures from Ukraine put state debt at 804B hryvnia ($70B), or 52,7% of the GDP; if Gazprom's demand is met, the ratio would rise above a 60% threshold that would give Russia the right to demand an early redemption.
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  • 12:57 PM
    • Tobacco stocks brush aside news that the FDA is moving closer to regulating the e-cigarette industry.
    • Lorillard (LO +1.1%), Altria (MO +0.6%), Reynolds American (RAI +1.5%), Vector (VGR +1.1%), and Philip Morris (PM +0.6%) are all in positive territory for the day.
    • The early read on the action by the FDA is that it may favor the larger players in the e-cig industry as the barriers to entry become more rigid.
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  • 12:54 PM
    • T. Rowe Price Group, Inc. (TROW) declares $0.44/share quarterly dividend, in line with previous.
    • Forward yield 2.12%
    • Payable June 27; for shareholders of record June 13; ex-div June 11.
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  • 12:53 PM
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  • 12:52 PM
    • Westamerica Bancorporation (WABC) declares $0.38/share quarterly dividend, in line with previous.
    • Forward yield 2.92%
    • Payable May 16; for shareholders of record May 5; ex-div May 1.
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  • 12:46 PM
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  • 12:42 PM
    • Nucor's (NUE -1.2%) Q1 earnings rose 31% but missed estimates, and the steelmaker forecast only "some improvement" in the current quarter when analysts had expected to see significant growth.
    • Morgan Stanley analyst Evan Kurtz says NUE's lukewarm Q2 forecast could point to worse than expected earnings, while noting that the company tends to give conservative guidance; analysts, on average, have forecast earnings of $0.65/share for Q2.
    • Tons shipped to outside customers rose 8% Y/Y in Q1, and the average sales price was up 3%, but average scrap and scrap substitute costs rose 5%.
    | Comment!
  • 12:37 PM
    • Tesla Motors (TSLA -0.1%) appears to have a friend in the Federal Trade Commission on the issue of the direct sale of automobiles to buyers.
    • In a blog post on the FTC website, the agency says it's "bad policy" for consumers accustomed to using the Internet to compare and shop be forced into the dealership network.
    • The automaker has run into some roadblocks in several states where powerful dealership associations have been hard to brush aside.
  • 12:26 PM
    • In addition to beating Q1 estimates, Infinera (INFN +5.9%) guided on its CC (transcript) for Q2 revenue of $160M-$170M and EPS of $0.02-$0.06 vs. a consensus of $156.3M and $0.05. As is its custom, rival Ciena (CIEN +5.8%) is following Infinera higher.
    • Thanks to a favorable mix, Q1 gross margin was 41.8%, +40 bps Q/Q and +590 bps Y/Y, and above guidance of 40%. Infinera only forecasts a GM of 39%-41% for Q2 due to the margin pressure caused by new large-footprint deployments, but still expects a low-40s GM for the full year and future margin gains as it fulfills capacity expansion orders for major deployments.
    • Strong North American demand allowed revenue to grow 3% Q/Q in seasonally weak Q1. Infinera had two 10%+ customers - a cable MSO and a tier-1 North American carrier, and added one more client for its dense/high-capacity DTN-X optical transmission platform, raising the total to 42.
    • Not surprisingly, a positive outlook was provided for the 100G optical market, where the company and Ciena have leading positions. Infinera says it's confident it can outgrow the broader 100G market in 2014.
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  • 12:20 PM
    • Time Warner Cable (TWC +0.2%) narrowed video customer losses to 34K in Q1 while adding 269K new broadband subscribers.
    • At the end of the quarter, the company had 11.2M video customers and 11.4M broadband Internet customers in its fold.
    • Average monthly programming costs per video subscriber rose 10.2% to $37.69, but overall the company kept a lid on cost increases.
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  • 12:15 PM
    • Oceaneering (OII +3.4%) moves higher after Q1 earnings and revenues beat expectations on the back of strength in its subsea products division, which saw higher demand for undersea hardware and the umbilicals line with an $894M end-of-quarter backlog.
    • OII added 14 new ROV systems to its operations during Q1, and increased utilization to 86% from 83%.
    • OII expects all of its business segments to continue growth and post higher income in 2014 than in 2013; sees Q2 EPS of $0.97-$1.01 vs. analyst consensus estimate of $1.04, and FY 2014 EPS of 3.90-$4.10 vs. $4.03 consensus.
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  • 12:11 PM
    • "While title insurance operations remained profitable, a transitory real estate and mortgage market downturn halted the fast-paced earnings progress of the past three years," says Old Republic (ORI -3.6%), leading off its Q1 earnings report.
    • General insurance net premiums earned of $663.2M up 9.1% Y/Y. Net investment income of $66.1M up 6.1%. Benefit and claim costs of $500.9M up 12.2%. Pretax operating income of $64.6M falls 6.2%.
    • Title insurance net premiums earned of $393.8M falls 14.5% Y/Y. Net investment income of $7.1M up 9%. Pretax operating income of $4.7M falls 77.8%.
    • Mortgage insurance and consumer credit run-off business post pretax operating income of $19.5M vs. a $20.2M loss one year ago.
    • Source: Press Release
    • Previously: Old Republic International EPS in-line, misses on revenue
    | 1 Comment
  • 12:03 PM
    • KKR Financial (KFN +3.2%) reported Q1 earnings yesterday after the bell, but the stock is ahead because of a 3%-plus gain at KKR which reported its results earlier this morning.
    • Previously: Surging markets boost KKR
    • Previously: KKR Financial Holdings LLC misses by $0.02
    • KKR expects its acquisition of KKR Financial to close sometime this quarter. KFN owners will receive 0.51 shares of KKR for each share of KFN they own.
    | Comment!
  • 12:00 PM
    • Dow +0.13%.
    • 10-yr -0.05%.
    • Euro +0.07% vs. dollar.
    • Crude +0.59% to $102.04.
    • Gold +0.41% to $1289.9.
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  • 11:59 AM
    • Lockheed Martin (LMT) declares $1.33/share quarterly dividend, in line with previous.
    • Forward yield 3.31%
    • Payable June 27; for shareholders of record June 2; ex-div May 29.
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