Dow Extends Winning Streak to Eight (NYX, SMSI, DIS, KO, OPEN, IR)
It was a mixed day on Wall Street, as the Dow managed to squeeze out a small gain to extend its winning streak to eight. Companies are generally posting good results, although a common theme among many firms is increased input costs, signaling that inflation is creeping in. A strong rebound in demand is offsetting this headwind, but it is something for investors to watch. The bigger issue, though, is will increased inflation force the Fed’s hand to raise interest rates before generally expected. A more hawkish Fed could take a lot of the steam out of stocks; although we don’t think this is an immediate concern over the next few months.
The Exchange Stocks Index was the top performing tickerspy Index on the day, led by NYSE Euronext (NYX) with a 14% gain. The Mobile and Wireless Software Stocks Index was the day’s worst performing tickerspy Index, with Smith Micro Software (SMSI) down -35%.
Stocks finished the day mixed, with the Dow the lone winner up 7 points to 12,240. The S&P lost -4 points to 1,321, while the Nasdaq gave back -8 points. Oil slipped -23 cents to $86.71 a barrel, while gold rose $1.40 to $1,365.50 an ounce.
In earnings news, shares of Walt Disney (DIS) jumped 5.3% after the media company said its fiscal first-quarter profit rose to $1.3 billion, or 68 cents a share, from $844 million, or 44 cents, a year earlier as revenue rose 10% to $10.7 billion. Both numbers topped analysts’ expectations. Better attendance at theme parks and increased ad revenue at its television networks were two of the catalysts behind Disney’s improved results. Nearly 80 pros held Walt Disney in their portfolios at the end of the third quarter, and almost 900 tickerspy members own the stock in their portfolios.
Coca-Cola (KO) shares rose 0.5% after the world’s largest soft drink maker said its fourth-quarter profit more than tripled to $5.77 billion, or $2.46 per share, from $1.54 billion, or 66 cents per share, a year earlier. Excluding one-time items, the Dow component earned 72 cents a share, meeting the consensus estimate. Revenue climbed 40% to $10.49 billion, topping the consensus estimate of $10.16 billion. Nearly 300 pros held Coca-Cola in their portfolios at the end of the third quarter, and almost 2,000 tickerspy members own the stock in their portfolios.
Online restaurant reservations firm OpenTable (OPEN) saw its fourth-quarter profit soar 65% to $5.1 million, or 21 cents per share, from $3.1 million, or 13 cents per share, a year earlier. Excluding one-time items, the company said it earned 33 cents a share, topping the 22 cents analysts were expecting. Revenue climbed 61% to $30.8 million, coming in above the $30.3 million consensus. The stock rose 0.7%.
Industrial conglomerate Ingersoll-Rand (IR) posted a Q4 profit of $212.1 million, or 62 cents per share, up 52% from $139.4 million, or 42 cents per share, a year earlier as revenue climbed 13% to $3.71 billion. However, the stock fell -5.7%, as analysts were expecting EPS of 64 cents on sales of $3.58 billion. Ireland-based Ingersoll-Rand said it expects to earn $2.90-$3.10 a share this year on sales of $15.0-$15.3 billion. Analysts had been expecting a profit of $3.09 a share on revenue of $14.9 billion.
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