April Earnings Season: Game On!

  • Posted: 05 April 2009 06:54 PM

    The April earnings season is upon us. I’m not expecting stellar results nor ambitious guidance. Quite the contrary. What I am interested in the ways in which corporate America is positioning itself for the balance of calendar year 2009 and the number of major restructurings still to be announced.

    I expect a new phase of corporate acquisitions and industry consolidations and the earnings season may provide clues as to which are the strongest players to emerge in this changing economy and which firms might be found on the auction block awaiting the highest bidder.

    What are your expectations for the season?

         
  • Posted: 05 April 2009 08:41 PM #1

    I think the first two quarters of this year will be as bad as expected, but will stabilize in the last two quarters before we see slow growth in 2010.

    Tan, please quit hijacking threads. There are plenty of other threads you can use to spout your bitter opinion.

    [ Edited: 05 April 2009 08:47 PM by litespeed ]

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    Posted: 06 April 2009 10:39 AM #2

    Must admit, I’m not quite ready for my metaphysical accounting yet, at least not this Easter.

    Edited: as to more profane accounts, nobody expects wonderful earnings, but given many recent stats came out better than expected (or at least no worse, viz unemployment), I wonder if there’s a fair chance for earnings to do the same.

    For AAPL, the big question remains whether March and the new desktops can make up for January and February weakness.  And how will the markets react to Apple’s first year-on-year sales decline in… years?

    [ Edited: 06 April 2009 10:41 AM by Winterpool ]

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    Posted: 06 April 2009 11:05 AM #3

    Winterpool - 06 April 2009 01:39 PM

    Must admit, I’m not quite ready for my metaphysical accounting yet, at least not this Easter.

    Edited: as to more profane accounts, nobody expects wonderful earnings, but given many recent stats came out better than expected (or at least no worse, viz unemployment), I wonder if there’s a fair chance for earnings to do the same.

    For AAPL, the big question remains whether March and the new desktops can make up for January and February weakness.  And how will the markets react to Apple’s first year-on-year sales decline in… years?

    I’m pretty sure that “and then a miracle happens” has become an acceptable part of everyones’ financial model.

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    Posted: 06 April 2009 06:46 PM #4

    Winterpool - 06 April 2009 01:39 PM

    Must admit, I’m not quite ready for my metaphysical accounting yet, at least not this Easter.

    Edited: as to more profane accounts, nobody expects wonderful earnings, but given many recent stats came out better than expected (or at least no worse, viz unemployment), I wonder if there’s a fair chance for earnings to do the same.

    For AAPL, the big question remains whether March and the new desktops can make up for January and February weakness.  And how will the markets react to Apple’s first year-on-year sales decline in… years?

    Overall sales and EPS will be up YOY for Apple.  The Ipod has been experiencing slow to zero growth for a couple quarters if you don’t include iphone, so this should not be a shock to the street.  The desktop was down 25% YOY last qtr and laptops up 34%, so I would not expect a huge reaction as long as the desktop is better then -25% and the laptop is still growing.  The consensus eps of 1.08 gives Apple plenty of room to beat on the upside with all the Iphone deferred revenue.

    According to NPD, Mac units for Jan/Feb averaged out to an 11% y/y decline, which doesn?t take into account stronger international sales and the new desktop shipments.  According to NPD, US iPod sales Jan/Feb average out to a 15% y/y unit decline (-16% in Feb, -14% in Jan). However the 15% y/y unit decline should be offset by a better performance in international markets and the new shuffle, which sold into the channel in early March.

    In my opinion Apple will beat handily but the guidance for next quarter always causes the street angst.  If Apple sells 4M Iphones this quarter then we will have built up about .75c in EPS just from the Iphone heading into the FY 3rd quarter so I wouldn’t be too concerned about guidance, but I have never been able to determine how the street will react.