Market Lower After Snow Day for Stocks
Stocks couldn’t gain any traction as snow gripped Wall Street and much of the Mid-Atlantic region today. There was no follow-through to yesterday’s big rally, and we still believe the short-term trend will take the market lower into correction territory. However, we’re not of the belief that the market is going to plummet from here, and would recommend having cash on the sidelines to accumulate shares some of the attractive large-cap tech names we’ve previously discussed — Cisco (CSCO), IBM (IBM), Google (GOOG) — on further weakness.
The major market averages ended the day lower, with the Dow down -20 points to 10,038. The S&P fell -2 points to 1,068, while the Nasdaq dropped -3 points to 2,148. Oil rose 73 cents to $74.48 a barrel, while gold edged down -$1.10 to $1,076.10 an ounce.
In earnings news, media giant Disney (DIS) posted a fiscal Q1 profit of $844 million, or 44 cents per share, down slightly from $845 million, or 45 cents a share, a year ago. Adjusted EPS came in at 47 cents, well ahead of the 38-cent consensus. Revenue rose 1% to $9.74 billion, led by a 7% increase in its media network division to $4.2 billion. Theme park revenue was flat, while movie studio revenue inched down slightly. The stock rose 0.6%. Sixty-seven Pro investors counted the stock among their top-15 holdings at the start of Q4, while over 650 tickerspy members included the stock in their portfolios.
Baidu (BIDU) shares jumped 10.8% after the Chinese search engine operator’s Q4 results cruised past analyst estimates. For the quarter, the company earned $62.7 million, or $1.80 per share, up 48% from $42.3 million, or $1.22 per share, a year earlier. Excluding stock-based compensation expenses, adjusted EPS was $1.88. Revenue climbed 40% higher to $184.7 million. Analysts were looking for EPS of $1.68 on revenue of $180.0 million. For Q1, the company forecast revenue between $176-$181 million, well ahead of the $170.2 million Wall Street consensus. Twenty-seven investors counted the stock among their top-15 holdings at the start of Q4, while over 1,100 tickerspy members included the stock in their portfolios.
OpenTable (OPEN) shares zoomed 22.7% higher after the online restaurant reservation company’s Q4 results topped Wall Street estimates. For the quarter, the company recorded net income of $3.1 million, or 13 cents per share, versus a loss of -$875,000, or -9 cents per share, last year. Excluding stock-based compensation, adjusted EPS was 14 cents, up from 3 cents a year ago. Revenue rose 32% to $19.2 million. Wall Street was expecting EPS of 9 cents on sales of $19.1 million. In North America, the company seated 11.8 million diners, a 39% increase, while internationally it seated 300,000 diners, a 99% jump.
Shares of EOG Resources (EOG) fell -6.7% after the oil and gas driller’s Q4 results missed analyst estimates. Its quarterly earnings dropped -13% to $400.4 million, or $1.58 per share, from $461.5 million, or $1.84 per share, a year earlier. Adjusted EPS was 92 cents, missing estimates by 6 cents. Revenue rose 8% to $1.76 billion, which was well ahead of the $1.33 billion analyst estimate.
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