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It was touch and go all day for the market on the final day of
the trading week, but when push came to shove as the closing bell
rang, it was a stalemate. The
ended the day at 2091.58, up just 0.10 points.
It could have been worse, however, and for owners of
American Airlines Group Inc
), it was worse.
These three names lost an inordinate amount of ground today,
mostly thanks to earnings and/or outlooks.
American Airlines Group Inc (AAL)
The good news is, American Airlines Group managed to top its
first quarter estimates. The bad news is that the company isn't
feeling too confident about the near future.
Last quarter, American Airlines
earned $1.25 per share
on revenue of $9.44 billion. Both were better than expectations
of $1.18 per share and sales of $9.43 billion.
Consolidated passenger revenue per available seat
mile fell 7.5%
as capacity growth outpaced actual demand, and was further
crimped by lower fares stemming from cheaper jet fuel.
In an indirect acknowledgement that headwinds are now blowing,
the company asked that AAL shareholders brace for the likelihood
that revenue was apt to remain suppressed in the near-term.
Specifically, American Airlines believes
its current-quarter PRASM will fall between 6%
AAL closed 4.5% lower today.
Microsoft Corporation (MSFT)
The market had been giving Microsoft CEO Satya Nadella the
benefit of the doubt of late, tolerating tepid earnings and
revenue growth on hopes that the company's transition from a PC
software company to a cloud-oriented company would eventually pay
With yet another quarter of lackluster progress on the
fundamental front though, investors are starting to have their
doubts … if Friday's 7% selloff is any indication.
Last quarter - the company's fiscal Q3 - Microsoft
earned 62 cents per share on $22.08 billion in
. Problem is that the market had been expecting a profit of 64
cents per share of MSFT. The top line essentially matched the
outlook for $22.09 billion, but it wasn't tough for traders to
see the glass as half-empty with
revenue falling 5.5%
on a year-over-year basis.
Starbucks Corporation (SBUX)
Last but not least, Starbucks shares lost 5% of their value on
Friday following its disappointing fiscal second quarter
Starbucks earned 39 cents per share on $4.99
billion in revenue
. Income was in line with estimates, while missed expectations of
Nevertheless, both numbers were much better than the
comparisons to the same quarter a year earlier, when Starbucks
earned 33 cents per share on $4.56 billion worth of revenue.
Same-store sales were up 6%, though analysts were looking for a
The concerning change in the company's loyalty rewards program
earlier this month doesn't appear to be an impasse … at least not
yet. Those changes
led to an 8% increase in participation
domestic enrollment in the rewards program was up
on a year-over-year basis.
Still, investors have their doubts SBUX can justify its
lofty valuation anytime soon.
As of this writing, James Brumley did not hold a position
in any of the aforementioned securities.
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