Wednesday, July 22, 2009

Street reactions to earnings (YHOO, AAPL, SBUX)

AlphaNinja - I noted some of the details of the Yahoo and Starbucks earnings last night. Yahoo is flat on the day after trading down last night and this morning, possibly due to confusion over guidance. Starbucks is up, as people are looking WAY beyond this year's earnings when valuing the stock. Jeffries worries about the "quality of those earnings."

Yahoo - seriously, I think I'm right, and these (admittedly murky) guidance was not as bad as people thought. It's up 3.2% right now, 7% off it's morning low.

-->> Deutsche raises target to $15. They're lukewarm on the shares in the near term, but see the firm's re-investment plan paying off over the next year and a half

-->>Jeffries liked the quarterly results, with EBITDA above their estimates. They see the guidance as low due to hiring initiatives this coming quarter. Interestingly, they "see YHOO's positive front page redesign as complementary to MSFT's early success with Bing, and conducive to a partnership."
-->> William Blair saw last night's results as "mixed," with revenue per search declining.

------------------------------------------------------------------------------------------------
Starbucks (SBUX) results were ahead by a few pennies, and the street is atizzy, sending shares 18% higher!

-->>Deutsche raises their opinion to Hold from Sell and takes the target to $14 from $9. They cite "materially better cost management." They worry about McDonalds competition, as well as the danger of peddling "affordable luxuries" in this environment.

-->>Argus upgrades to Buy and takes their target to $20, as they like the slowing store expansion (helps cash flow), better expense management, and focused programs that should drive traffic. They expect other investors to "bid up" the shares on anticipation of improves same-store-sales.

-->>Jeffries, maybe the more awake of the bunch, notes that earnings were helped by a 2cent benefit from cost cuts and 2cents from a lower tax rate. (Nothing wrong with cost cuts guys, take it easy!). They see the cost cuts as "buying time" until sales recover.

You know the Deutsche research team ain't having a fun morning, as SBUX is up 47% since they downgraded it to a SELL on April 15th....(Hey to be fair I've been negative on the shares for a while too)




No comments:

Post a Comment