Thursday, July 30, 2009

Ecolab- Richie Civello

Ecolab came out with earnings on Tuesday.

Revenue of $1.44 billion for the quarter ended June 30 was down 8 percent from $1.57 billion in the same period last year. Excluding restructuring and other items, the St. Paul, Minn.-based company reported income of 50 cents per share; expected earnings were $0.48 cents per share. Reported earnings were $0.41 per share due to restructuring charges and currency exchange rates. Ecolab reduced its 2009 earnings-per-share outlook to a range of $1.96 to $2.02 from a previous forecast of $1.95 to $2.05, excluding anticipated restructuring charges of 21 cents per share to 23 cents per share.

As of today they were upgraded by JPMorgan to “Neutral” from “Underweight”

Ecolab credits new product sales, pricing, cost reduction, and new account gains as the reason for beating earnings. Gross margins increased to 49.7%, up from 49.1%

With the company held view that the markets, while stabilizing, are not going to be enough to make profits go any higher further cost-cutting initiatives are going to be implemented. Along with new product development and increasing efficiencies, this company is taking the right steps.

Management seems fully aware of the economic situation and is taking the right steps to create growth and remain profitable. I affirm this company as a hold for the portfolio as it has been one of the more stable names in the portfolio and should provide consistent and steady returns for us.

Tuesday, July 21, 2009

AAPL F3Q09 Earnings 07/21/09-(Daren Pon)

Apple (AAPL) this evening reported fiscal third-quarter results that beat analysts’ sales and profit estimates.

Apple revenue rose 12%, year over year, in the quarter to $8.34 billion, while net income came in at $1.23 billion, or $1.35 per share.

That compares to an average estimate for $8.2 billion in sales and $1.17 per share, or $1.31, excluding options expenses. The results were ahead of Apple’s own forecast for revenue of $7.6 billion to $8 billion and profit of 90 cents to $1 per share.

Gross profit was likely much higher than people’s grim expectations, 36.3%, up from 34.8% percent in the year-earlier quarter.

For the fourth quarter, Apple, as per usual, offered a rather restrained forecast, projecting revenue of $8.7 billion to $8.9 billion and EPS of $1.18 to $1.23, less than the $9.1 billion and $1.30 analysts have been projecting.

Apple shipped 5.2 million iPhones in the June quarter, 10.2 million iPods, and 2.6 million Macs, the company said.

The reported sales and profit don’t include some proceeds from iPhone that are recognized ratably over months that a phone is owned. Including those non-GAAP amounts, Apple generated $9.74 billlion of “adjusted sales” and $1.94 billion of “adjusted net income.” On a per share basis, using a diluted share count of 909.2 million shares, that comes to about $2.13 per share in adjusted EPS, I reckon.

Apple generated $2.3 billion in cash flow from operations in the quarter, the company said.

Apple will host a conference call with analysts at 5 pm, which you can listen to here.

Despite the restrained forecast, Apple shares rose $5.73, or 3.8%, to 157.24 in after-hours trading, after falling 1% during the regular session.


DD- Earnings(Richie Civello)

Wilmington-based DuPont on Tuesday reported earnings of $417 million, or 46 cents per share, in the three months ended June 30, down from $1.08 billion, or $1.18 per share a year earlier.Overall revenues tumbled 24 percent to $7 billion, from $9.3 billion a year ago.Excluding one-time items, adjusted earnings were 61 cents per share, beating the consensus estimate from analysts polled by Thomson Reuters of 53 cents a share on revenue of $7.1 billion.

Overall product volume is down 19%. Chemicals produced by the company are used in a wide variety of industries and are a main component of the decreased volume. Auto and housing products are also reasons for this decrease in business. On the positive side DuPont's agriculture segment saw positive growth due to increased prices.

Much of their profit is due to cost cutting which the company says the company can maintain at a 75% level. Also new product volume is up 20% to 316 products when compared to YoY numbers.

I am concerned that the company will stay within the same range unless there is some significant growth in either the housing/auto industries. Their agriculture segment, while strong, is too small a segment to keep the company up. In order for DD move out of the high $20 range either positive auto or housing news will hae to come out.

Monday, July 20, 2009

CAT - Recent News (Opanowski)

Caterpillar Incorporated was up 7.83% on July 20th, on the news that Bank of America-Merrill Lynch has upgraded CAT to a "buy."

Bank of America-Merrill Lynch stated that the end of the second quarter could possibly mark the bottom of the construction sector.

Also, CAT is up 8.73% as of 3:30 PM EST, July 21 on some recent news put out by management. Although CAT's second-quarter profits were down a dramatic $1.14 per share from Q2 2008 to Q2 2009 at $0.60 per share, management has updated their outlook for the remainder of 2009. Management says that it is very satisfied with the results of the various cost cutting strategies they have been implementing for the past several months and feels confident in the way they have steered the company through the recession and is optimistic going forward.

The updated sales and revenue range for 2009 is $32 billion to $36 billion and the profit per share range is $1.15 to $2.25.

Some concerns I have that still need to be addressed are whether demand for their products is going to increase anytime soon and how much the new cap-and-trade policy will affect CAT.