Trefis Week in Review

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The Week in Review

Below is a summary of the activity on Trefis during the past week that we thought you would find interesting.

Insights from the Week


Technology Media & Telecom

 

The company's video subscriber losses were higher than expected, and unlike Q1, broadband and digital voice subscriber gains could not compensate for video losses …

Although the economy has been slow to recover, the advertisement market has picked up as evident from last quarter's results …

Sisrius' success has been hinged on its ability to successfully monetize through vehicle installations and therefore, this health of automotive market remains a crucial factor …

  • Monster Earnings Show Solid Growth Though Some Concerns Persist on June 29, 2011

The company's Achilles' heel remains its Internet advertising & fees business, which posted revenues relatively flat over the last year owing to reduced lead generation and a decline in military recruitment …

  • Declining Smartphone Mix a Worrying Sign for Motorola Mobility on June 29, 2011

Motorola Mobility recently announced its Q2 earnings in which its smartphone mix declined for the first time since Motorola started selling smartphones in late 2009 …

  • Could iPhone 5 Lift IPhone's Gross Margin Outlook? on June 29, 2011

This upside is justifiable if Apple is able to sell iPhone 5 at a higher price point and curb its manufacturing costs while ensuring smoother distribution and management of its supply chain …

  • Priceline.com Earnings Preview: Airlines Partnerships in Focus on June 29, 2011

While the impact of these partnerships will only be noticeable after a few quarters, these have the potential to securely put Priceline on a long-term growth trajectory …

  • Akamai's Stock Crashes on Weak Outlook, Sell Off Overdone on June 28, 2011

Akamai now expects revenue growth for 2011 to be between 10-13% compared to the previous expectation of 15% growth. This and a weaker outlook overall has caused the stock to collapse post earnings …

  • iPhone Driving Subscriber Growth for Verizon as Stock Reaches for $40 on June 28, 2011

Verizon added 1.3 million retail postpaid subscribers in this quarter, which is the highest quarter of postpaid additions since the fourth quarter of 2008 …

  • Pandora Rides the Smartphone Boom Though Stock is a Tad Pricey on June 28, 2011

The total number of registered users increased from 22 million in 2008 to 82 million in 2010 and is likely to reach 130 million by the end of 2011 according to our forecasts …

  • Smartphone Chips Can Lift Sirius XM's Retail Subscriptions on June 28, 2011

Given the explosion of smartphone sales and usage, this could lift the number of retail subscribers for Sirius especially if rumored new chips are pre-installed in phones that allows satellite radio delivery to phones directly vs. online take off …

  • AT&T's Smartphone Sales Driving Data Revenue Growth on June 28, 2011

The average data revenues per subscriber (ARPU) for smartphones was 1.8x compared to other devices, which means that this parameter benefits immensely from increasing smartphone penetration …

  • NYT Can Wobble to $9 on Digital Growth as About.com Suffers on June 28, 2011

We have adjusted the price based on adjustments to revenue per page forecasts for About.com, adjustments to circulation-based revenues for NYT and changes in the net cash/debt position over the last quarter …

  • Monster Q2 Earnings Preview: What We're Watching on June 27, 2011

For this quarter, we will focus on the impact of Monster's successful integration with Yahoo's HotJobs platform in Q1 and the effect it might have on its career services divisions …

  • Motorola Mobility Earnings Preview: Can it Turn a Profit in 2011? on June 27, 2011

The major risk to Motorola's market share are the product delays, which allows competitors to tap the smartphone market trend earlier than Motorola …

  • Sprint Preview: All About Subscriber Growth on June 27, 2011

Sprint continues to lose overall subscribers (except for Q4 2010 when it gained 58,000 subscribers) as its CDMA subscriber base continues to rise …

  • TWC Earnings Preview: Broadband & Cable Subscriber Trends in Focus on June 27, 2011

Time Warner Cable faces the same issues as the whole cable industry, which is the loss of pay-TV subscribers to satellite, telecom and Internet based competitors …

  • Netflix Worth $220 on Revised Estimates for Streaming & International Growth on June 27, 2011

In addition to the price revision, we have updated our valuation model to better reflect the contribution of international growth, which we peg at around 30% of Netflix's overall stock value …

  • Microsoft Shows Broadbased Growth but Upside Capped at $28 on June 27, 2011

While Windows sales have slowed down a bit with revenues decreasing 2% from the last year, the launch of Windows 8 in the coming year should give the sales numbers a huge boost …

  • Expedia's Partnership with Travel Agents Adds New Leg of Growth on June 26, 2011

According to PhoCusWright's Global Online Travel Overview Second Edition report, travelers are expected to book one third of the world's travel sales online by the end of 2012 …

  • Filmed Entertainment Trends for Time Warner, Disney, News Corp and Comcast on June 26, 2011

We estimate that the filmed entertainment business constitutes about 35% to Time Warner's stock and about 20% each to News Corp and Disney's stocks as per our estimates …

  • Akamai Earnings Preview: Pricing & CDN Competition in Focus on June 26, 2011

Akamai has started to face pricing pressure from its competitors, and as a result, has renewed some of its content delivery contracts at lower price points …

  • NBCUniversal Chips in 20% of Comcast's Stock Value on June 26, 2011

The strategic value of the joint venture comes from the idea that by having more control over its content, Comcast is more resilient to competitive pressures going forward …

  • Juniper Q2 Earnings: Has the New Network Arrived? on June 26, 2011

The market trends of mobile, Internet and cloud computing are creating demand for a new approach to networking and Juniper is moving fast to capitalize on this new opportunity …

  • Expedia Earnings Preview: Airline & Groupon Alliances in Focus on June 26, 2011

Groupon is creating a special section on its site called Groupon Getaways that will offer deep discounts to the tune of 50% on travel-related services by tapping Expedia's inventory of hotel rooms and travel services …

  • Amazon Fuels International Growth with The Book Depository Acquisition on June 26, 2011

The Book Depository also offer a U.K. based fulfillment center to serve Amazon's European customer base. This can help Amazon grow its international share of books, DVDs & music sales …

  • Symantec Earnings Preview: Profit Margins on Storage Software & Norton in Focus on June 25, 2011

Due to increasing competition in both segments as well as increased SG&A and R&D expenses, the EBITDA margins in both divisions have been seeing downward pressure in the past couple years …

  • SAP Earnings Preview: ERP, CRM & Gross Margins in Focus on June 25, 2011

Though SAP's revenue streams are well diversified, but Enterprise Resource Planning (ERP) software and Customer Relationship Management ( CRM ) software comprise almost 55% of our valuation …

  • Amazon Earnings Preview: New Initiatives in Focus on June 25, 2011

In Q2, we believe that an improving global economic environment and Amazon's continued focus on offering new services and products will help the company continue its revenue growth across sectors …

  • Shutterfly Earnings Preview: What We're Watching on June 25, 2011

Shutterfly makes a bulk of its revenues from its Photos, Cards, Albums and Stationery division which comprises almost 88% of the Trefis price estimate for Shutterfly ..

  • Lackluster Showing for AMD's Server Business, Though Still Worth $9.80 on June 25, 2011

AMD is hoping that its launch of Bulldozer server chips in Q3 2011 combined with Interlagos platform aimed at cloud-computing environment will help it gain some share towards the latter half of this year …

  • LinkedIn to Lose Steam as Competition Will Weigh on Unique Visitor Growth on June 25, 2011

LinkediIn has seen rapid growth in its monthly unique visitors historically from an estimated 4.5 million in 2007 to around 50.5 million in 2010 and is still keeping up with its staggering pace …

 

(Trefis Pro Exclusive) Consumer, Retail, & Automotive


  • Marlboro is Still the Man at Altria, Carries Results on June 29, 2011

The cigarettes division that contributes almost three-fourths of Altria's stock value continued to lead the solid operating company income (OCI) growth of 6% year-over-year (yoy), 3% on an adjusted basis …

  • Toyota's International Sales Growing as the Supply Chain Recovers on June 28, 2011

Toyota's international vehicles sales account for around 42% of its global vehicle sales and sells its vehicles mainly under three brands: Toyota, Lexus and Scion …

  • Kimberly Stuck on $65 as Inflation Gnaws on Profits on June 28, 2011

Due to stringent measures by central banks to check inflation, we expect inflation to cool off towards the end of the year and in such as event, the margins could expand moderately …

  • Philip Morris Shows Smokin' Growth in Asia on June 28, 2011

The Asian markets of Indonesia, Japan and Korea continue to drive PMI's cigarette sales volume and all posted double digit revenue growth …

  • Coca-Cola Eyes $72 on China Growth Potential on June 28, 2011

Coca-Cola reported strong Q2 results with growth coming from emerging markets like China and Russia. China growth was led by 23% growth in sparkling beverages and 36% growth in Minute Maid Pulpy …

  • VIP Games in Macau Carry Wynn's Results on June 27, 2011

Wynn reported impressive growth in table games turnover in the VIP segment with $32.7 billion in Q2 representing an over 50% increase from Q2 2010 …

  • Revlon's Earnings Preview: What We're Watching on June 27, 2011

We were pleasantly surprised with Revlon's 2010 performance, with sales rising 2%, a moderate turnaround from the 4% year-on-year drop in sales over 2007-09 …

  • Colgate-Palmolive Earnings: Volume Growth a Concern on June 27, 2011

We expressed our concerns in the past regarding Colgate's volume-driven growth strategy amid rising costs in our Q1, which showed low volume growth despite higher advertising and promotional spending …

  • Daimler Earnings: Mercedes-Benz Sales in U.S., Germany, China Drive Results on June 26, 2011

In the first half of 2011, Mercedes-Benz remained the best-selling premium brand in Germany, its largest market, and grew by 7% yoy in the U.S., its second largest market …

  • Jones Group Earnings: Watching Commodity Pressures & Kurt Geiger Acquisition Impact on June 26, 2011

In the past quarter, revenues grew by 8% to reach $949 million however the firm's gross profit margin declined to just under 35% from last year's 37% …

  • Medical Device Tax Could Squeeze Kimberly Clark's Margins Further on June 26, 2011

Congress in 2010 passed a law that would charge 2.3% excise tax on the gross sales amount for medical-device manufacturers that would go effect in 2013 …

  • Chipotle Charges More for Chow but Cost Pressures Bite on June 25, 2011

Chipotle's reported strong Q2 results with a 22% quarter over quarter increase in revenues to almost $572 million, but cost pressures persist …

  • Ford Earnings: Fuel Efficient Models & Crossovers in Focus on June 25, 2011

Strong vehicle sales between January-June'2011 resulted in 12% growth year over year (yoy) on the back of continuing demand for Ford's fuel-efficient cars and crossovers …

 

(Trefis Pro Exclusive) Financial Services

 

  • Dow Heads for $39 with Solid Pricing & Volume Growth on June 29, 2011

The company reported sales and operating income growth of 18% and 24% respectively as the company is shifting its focus towards performance-based plastics over commodity-based ones …

  • RBS Continues to Shed Non-Core Assets on June 28, 2011

More recently, the company also announced its decision to put up its aircraft leasing and management business, RBS Aviation Capital, for sale in a deal that could fetch between $6 billion and $8 billion …

  • CME Group Preview: Volume Growth in Commodity & Interest Rates Contracts on June 27, 2011

Last quarter, the company reported a 20% increase in revenues and a 26% increase in operating income from the year ago period driven by strong commodities trading volumes …

  • MetLife Earnings Preview: Annuity & International Growth in Focus on June 27, 2011

We expect MetLife's variable annuity sales to remain strong in the remainder of 2011 as the company is expanding its distribution channels to reach more customers …

  • MetLife Sells its Banking Unit to Comply with New Regulations on June 25, 2011

It doesn't make sense for the company to be governed by regulations written for banking institutions, which could make it less competitive in the insurance market …

  • Visa Earnings: Transaction Volumes & Fees in Focus on June 25, 2011

Higher payment volume and increased number of transactions resulted earnings growth in the previous quarters and we expect it to lead the growth in this quarter too …

  • Barclays Bounces to $18 Managing Middle Eastern Wealth on June 24, 2011

The Capgemini and Merrill Lynch 2011 World Wealth Report mentions that the Middle East region had 400,000 HNIs in 2010 with a combined wealth of $1.7 trillion …

 

(Trefis Pro Exclusive) Energy & Natural Resources

 

  • Exxon Mobil Earnings: Revenue and E&P Growth Driven by Robust Demand on June 27, 2011

High oil prices are expected to help Exxon maintain the double digit growth in upstream revenues it has posted over the last few quarters …

  • Technology Investments to Spur Gas Demand Help Chesapeake Climb to $36 on June 26, 2011

The company also plans to invest $1 billion over the next 10 years in technologies that will drive the demand for natural gas such as setting up natural gas fueling stations at truck stops …

 

(Trefis Pro Exclusive) Basic Materials

 

  • DuPont Q2 Earnings Preview: What We're Watching on June 27, 2011

We are looking at the agriculture & nutrition products division for DuPont in this earnings release, which contributed significantly towards to its overall revenue growth of 18% year-on-year for Q1 …

  • Barrick Gold Earnings: Rising Gold & Copper to Offset Fuel Prices on June 27, 2011

The company booked a $10 million hedging gain in Q1 and depending on how well the company hedged fuel prices, we could see some negative (or positive) surprise here …

  • ArcelorMittal Q2 Earnings: Improved Utilization & Pricing in Focus on June 26, 2011

ArcelorMittal remains keenly focused on profitability pushing to reduce costs by achieving greater self-sufficiency in steel manufacturing input materials …

  • US Steel Earnings: What We're Watching on June 25, 2011

The natural disaster in Japan may hurt the company as the demand for steel in the automotive sector dropped as the automobile companies reduced their production due to a shortage of parts …

 

(Trefis Pro Exclusive) Industrials & Transportation


  • KMP Key Developments Behind Q2 Earnings on June 29, 2011

KMP recently announced its Q2 earnings posting a decline in the net income to $247 million from $361 million during the same period last year …

  • Raising Boeing to $91 on Commercial Deliveries & Dreamliner on June 29, 2011

The company's commercial airplanes division was the big winner for this quarter as both aircraft deliveries and prices rose leading to a revenue and operating income growth of 19% and 35% for the division, respectively …

  • Halliburton Benefits as Europe Looks for Energy Security on June 29, 2011

Shale projects are also coming up in the U.K., Sweden, Spain and Denmark and the Netherlands; however, Halliburton will need to tread lightly given heightened environmental concerns among many European countries …

  • We See United Continental at $27 if Fuel Prices Cooperate on June 28, 2011

While its earnings reflected some benefits from industry consolidation and improving economic conditions that resulted in higher fares and unit seat mile revenues, fuel prices continue to be a major concern for all airline …

  • JetBlue Earnings Preview: What We're Watching on June 26, 2011

JetBlue is building strategic commercial partnerships with several airlines as a part of its growth strategy to improve its market share on domestic and international routes …

  • American Aims for $6.70 Though Fuel Prices Make it a Choppy Ride on June 25, 2011

While these results are disappointing, we believe that in the medium-term American will reign in the costs and benefit from growing demand for air travel and an improving macro environment …

The growth was primarily driven by higher pricing and utilization of its products and services in the United States where activity in unconventional plays and liquid rich basins is driving demand …



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Investing Ideas , Stocks , US Markets

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