Joy Mining Machinery Founder Joseph Francis Joy (Photo credit: Wikipedia)
Joy Global (JOY : NYSE : US$49.16), Net Change: -2.15, % Change: -4.19%, Volume: 7,519,489
Joy Global, a maker of mining equipment, reported a 36% slide in quarterly orders and warned of
sharply lower revenue for a further year as coal producers cut back capital spending in the face of a supply glut and low prices.
Net income fell 5% to $183.2 million, or $1.71 per share. Revenue dropped 5% to $1.32 billion.
Excluding items, Joy Global earned $1.70 per share while analysts expected earnings of $1.37 per share, excluding items, on revenue of $1.18 billion. Joy Global maintained its 2013 forecast for earnings of $5.60-5.80 per share.
The company, which derives two-thirds of its revenue from sales to coal miners, said it would increase cost cutting to offset the slide in orders. Management maintained its forecast of revenue for the year to October 2013 of $4.9-5.0 billion, down from last year’s $5.66 billion, and it warned the following year would be worse.
“The current outlook (for 2014) is unlikely to support annual revenue above $4 billion,” Chief Executive Mike
Sutherlin said in a statement. This is sharply lower than the previous average expectation from analysts for revenue of $4.57
billion for the year ending October 2014.
Posted by Jack A. Bass on August 29, 2013
Google 貼牌冰箱（Google Refrigerator） (Photo credit: Aray Chen)
NASDAQ : US$910.68
Google owns the world’s largest search engine, some of the most visited websites on the web, including YouTube.com, as well as the telecommunications equipment corporation Motorola Mobility. Google generates the vast majority of its revenue through advertising on the web and mobile devices.
Google’s Q2 results saw both revenue and EPS below consensus. Q2 and Q3 seem like quarters of transition, first to a new Enhanced Campaign
paradigm for AdWords, and to a better user experience (and slower growth) for Google Network. We remain attracted to secular positives,
while recognizing that Google’s admirable quest to stay young and innovative may continue to push out realization of an “optimal” model.
The next chapter may be a big hardware cycle, which could draw questions about structural margins. However, we continue to like Google’s dominant competitive position in a large and growing market.
Bullish – Enhanced Campaigns now represent 75% of all AdWords campaigns, showing fast adoption; Android continues its massive climb with ~900 million activated devices; Web sites TAC slowed its pace of expansion at only 8.0%, up from 7.9% in Q1, the smallest expansion in years.
Bearish – Revenue and profitability miss; 6% CPC decline despite adoption of Enhanced Campaigns; self-inflicted slowdown in Google
Network growth should persist for two more quarters, along with an associated pick up in Google Network TAC to over 72% of revenue
compared to long-time run-rate of ~70%.
Estimate changes – We lower our 2013/2014/2015 combined gross revenue to $59.4B/$68.6B/$78.6B from $61.7B/$71.5B/81.6B, and
non-GAAP EPS to $43.99/$52.54/$62.99 from $46.72/$56.48/$64.82.
We raise our price target to $940 from $890 as we roll over to 2014E EPS. Our new target is based on 18x our slightly lower 2014 EPS estimate of $52.54.
Posted by Jack A. Bass on July 19, 2013
AMD (Photo credit: Majiscup – The Papercup & Sleeve)
AMD : NYSE : US$4.64
NOTE: This Company was an ” avoid” in the Apprentice Millionaire Portfolio ( available at Amazon.com ) just six months ago .
Advanced Micro Devices designs and produces microprocessors, graphics and media solutions for the computing, communications and consumer electronics markets. AMD is the world’s second-largest producer of microprocessors.
All amounts in US$ unless otherwise noted.
We are increasing our estimates and raising our price target to $6 following meaningfully higher Q3 revenue guidance versus consensus
expectations and our above consensus estimate. While upside to Q3 is largely console derived, AMD management is confident they are gaining
share in GPU in the 2H13 following small gains in Q2, and going forward growth will increasingly involve gross margin accretive areas
including embedded (STB, medical devices, digital signage), professional GPU and dense servers. Our rating remains BUY as we believe this
turnaround story appears to have legs.
AMD reported Q2/13A (Jun) after the close. Revenues and EPS were $1.161B/($0.09), better than our estimates of $1.110B/($0.12) and
consensus expectation of $1.108B/($0.13). The 7% sequential increase in revenues came in above their guided range (-1% to +5%) driven by a 12% Q/Q growth in Computing partially offset by a 5% Q/Q decline in Graphics and Visual solutions.
AMD guided revenue in Q3 to increase 22% Q/Q, plus or minus 3% mainly driven by the ramp of the semi-custom game console chip sales. At the mid-point, revenue guidance of $1.42B was above our prior estimate of $1.29B and consensus estimate of $1.22B. Operating expenses for Q3 are expected to be $450 million and gross margins are expected to decline to 36%.
AMD’s price target of $6 is 0.7x our C2014 sales estimate of $5.835B.
Posted by Jack A. Bass on July 19, 2013
EOPN : NASDAQ : US$17.41
E2open sells cloud-based supply chain management solutions for sophisticated trading networks. Powering 7 of the world’s 10 most complex supply chains, the firm’s software provides visibility into trading processes via technology for planning, execution, real-time modifications,
and deeply functional analytics. E2open is headquartered in Foster City, CA and went public in July, 2012.
EOPN’s solid quarter, positive commentary on business outlook, and our view that growth will be modestly better than our previous forecast are likely enough to drive the shares higher at least in line with subscription revenue growth of about 25% longer term. Reiterate BUY, increase target to $20.
A solid quarter: slight revenue and EBITDA upside. Non-GAAP revenues and adjusted EBITDA loss of $16.1M and ($3.6M) were respectively $0.3M and $0.9M ahead of our estimates. Subscription revenue grew 26% y-o-y (slightly better than forecast) and total revenues were up 4% as the firm’s transition of implementation services to partners will be a near-term drag on overall growth. FCF loss of ($3.3M) was in line with our estimate and bookings in the quarter were skewed slightly towards upsell into existing customers versus new logos (EOPN signed 4 new customers in the quarter).
Outlook: F2014 more or less unchanged. Management inched higher the low end of revenue guidance and noted that new/upsell bookings growth is now expected to be at the high end of the guidance range (roughly +30% to $91.5M). Our F2014 estimates are effectively unchanged; we increased our F2015 revenues by $1M and expect EOPN to be roughly FCF breakeven.
Valuation and price target
We are increasing our price target by $2 to $20, which is based on a 5.4x EV/revenue multiple applied to our C2014 estimate of $94.5M plus roughly $35M in prospective net cash.
Posted by Jack A. Bass on July 12, 2013
Dollarama (Photo credit: Wikipedia)
DOL : TSX : C$70.13
Dollarama Inc. is a leading Canadian dollar store, carrying general merchandise, consumables and seasonal products in locations across Canada. Products are sold at fixed price point intervals between $1.00 and $2.00.
We are reiterating our BUY rating and C$81.00 target price following Dollarama’s Q1/F14 earnings results.
Dollarama reported its first quarterly miss in 13 quarters on Wednesday morning, before the market open. EPS of $0.62 was below consensus of $0.67, but above last year at $0.56. The bulk of the earnings miss was attributed to lower than expected gross margins, and a slight step-up in SG&A expense. Gross margin as a percentage of revenue declined 40 bps YoY to 35.9%, as additional costs related to occupancy and logistics of new stores, which have not yet reached maturity, impacted the gross margin rate. This is anticipated to subside during the back half of the year.
Similarly, SG&A was impacted by both the timing of new SG&A initiative roll-outs, and the ramp up of new stores, with SG&A as a percentage of revenue increasing 30 bps YoY.
While Q1/F14 results disappointed, we believe the margin challenges experienced during the quarter are transitory, and should subside during the back half of the year. Importantly, we believe SG&A expense as a percentage of revenue will decline during the back half of the year, as the company’s numerous SG&A initiatives gain traction.
Posted by Jack A. Bass on June 14, 2013
Marvell Technology Group (Photo credit: Wikipedia)
MRVL : NASDAQ : US$11.31
Marvell is a global leader in semiconductor products for storage, networking, mobile and wireless end markets. The company is structured into four key business groups: Mobile & Wireless, Storage, Networking and Other Products.
BUSINESS IMPROVES, BUT DEMAND AND COMPETITIVE CONCERNS REMAIN
We reiterate a HOLD rating for MRVL following upside results and
strong guidance. While the company is delivering upside to near-term
expectations, we remain on the sidelines as we believe a weak market
for traditional PC weighs on storage revenues, while the Mobile &
Wireless rebound could be short lived due to an increasingly crowded
competitive environment in the emerging market. We note that strong
foundry demand in Q2 appears to be driven largely by components
shipping into the Chinese smartphone market from multiple vendors.
We are increasing our estimates and price target.
MRVL reported CQ1/13A (Apr) yesterday after the close. Revenues and EPS were $734.4M/$0.19, above consensus estimates of $722M/$0.14 and our estimates of $720M/$0.14. Revenue upside was driven by better than expected Storage and etworking sales partially offset by weaker than expected Mobile & Wireless sales.
Marvell repurchased 20 million shares in CQ1 for approximately $200 million and paid a quarterly dividend of $0.06/share.
The company guided CQ2 revenue to range from $770 million to $810 million ($790 million at the midpoint, up 8%), above the consensus view of $764 million, with EPS guidance of $0.19 at the midpoint above consensus of $0.18. This compared to our prior estimate of $762 million and $0.17.
Posted by Jack A. Bass on May 28, 2013
Flip Chip, flipped, attached to the carrier, underfilled, illustration made for Flip Chip (Photo credit: Wikipedia)
BESI : ENXT : €6.83
BESIY : OTC
BE Semiconductor Industries N.V. (Besi) develops, manufactures, and sells semiconductor assembly equipment designed to increase productivity, improve yields of defect-free devices and reduce cost of ownership. The company’s products are designed for use in two manufacturing echnologies: leadframe assembly and wafer level packaging.
ADVANCED PACKAGING DRIVES UPSIDE
We reiterate a BUY rating on shares of BESI following strong results and
guidance. We believe BESI will benefit from continued strong demand
for flip chip die bonding advanced packaging systems from new Asian
subcontractors in the smartphone and tablet supply chain. We expect
EPS to benefit from expanding gross margins and tighter opex controls.
We are increasing our estimates and raising our price target to €8.00.
BESI reported Q1/13A (Mar. Revenues and EPS were €64 million and €0.10, compared to our estimates of €59 million and €0.03. Revenue was up 14% Q/Q (+15% Y/Y), and came in above guidance of 5% sequential growth, driven by strong demand for advanced packaging systems. EPS benefited from better-thanexpected gross margins (39.6% vs. guide of 37%-39%).
Management guided Q2 revenue to be up 10% Q/Q, based on the 23% sequential order increase in Q1 and continued strong demand for advanced packaging systems.
BESI’s price target of €8.00 (was €7.00), is 8x our C2014 EPS estimate of €0.78 plus net cash of €1.72/share.
Posted by Jack A. Bass on April 26, 2013
Suffrage paraders: Mrs. McLennan, Mrs. Althea Taft, Mrs. Lew Bridges, Mrs. Burleson, Alberta Hill, Miss Ragsdale (LOC) (Photo credit: The Library of Congress)
NASDAQ : US$13.61
Disappointing revenue guidance sent shares of Omnivision lower on Friday, but Canaccord Technology Analyst Bobby Burleson expects a rebound considering:
1) design wins are strong with Chinese smartphone OEMs, who are likely to grow global market share;
2) OVTI’s Apple (AAPL) smartphone prospects were already dim; and
3) valuation is compelling even with a number cut.
OVTI reported Q4 Revenues and EPS of $423.5 million and $0.56, compared to consensus estimates of $411 million/$0.41 and Burleson’s estimates of $410 million/$0.41. Management guided Q1/C13 (Apr) to be down sequentially 25% Q/Q at the mid-point, with revenues expected to be $300-330 million and EPS is expected to be $0.14-0.29. This compared to consensus estimates of $371 million/$0.32 and Burleson’s estimate of $375 million/$0.36.
On the weak guidance, Burleson revised his estimates for the company, now seeing Q1 revenue coming in at $315 million (down from $375
million) and full-year revenue being $1.415 billion (down from $1.587 billion). On the earnings front, he sees Q1 EPS of $020 (down from $0.36) and for the full year, he sees $1.62 (down from $1.24).
Posted by Jack A. Bass on March 5, 2013
Cooper Tire & Rubber Company (Photo credit: Wikipedia)
CTB : NYSE :
Cooper Tire & Rubber’s fourth-quarter earnings fell 65% as the year-earlier period had a large taxbenefit, masking revenue growth and sharply higher margins as the company benefited from declining raw materials costs.
The company reported a profit of $73 million, or $1.15 a share, down from $209 million, or $3.33 a share, a year earlier while revenue increased 2.3% to $1.06 billion. Analysts had projected earnings of $0.85 on revenue of $1.03 billion.
Sales in the company’s North American segment, which provides the majority of revenue, grew 5.2% thanks to improved volume and higher prices. “A strong fourth quarter capped off a great year,” said Chief Executive Officer Roy Armes. “Due in large part to successful product launches and demand for our products, the company has increased unit volumes and outpaced the industry in our key markets for the full year.”
However, the company views 2013 with cautious optimism amid continued uncertainty about the economy. Cooper expects that raw material costs in the current quarter will be about the same as during the fourth quarter, which represented a 2% decrease from the third quarter. However, over the longer term raw material prices are expected to generally trend higher.
Posted by Jack A. Bass on February 27, 2013