Author Archives: Scalper1

Amazon’s Blowout Q1 Earnings Are Reminder Of Stock’s ‘Huge Potential’

Investors rewarded e-commerce leader  Amazon.com ( AMZN ) after the company late Thursday posted  Q1 earnings  that handily beat expectations, as Amazon Prime and the Amazon Web Services cloud business continued to roll. In midday trading on the stock market today , Amazon stock rose 9.3% to about 658 after hitting 669.98 earlier. The company’s stock more than doubled in 2015 but — much like the rest of the market — struggled in early 2016. The stock plunged three months ago after the company missed Wall Street’s outsized Q4 expectations . Jefferies analyst Brian Pitz bumped its price target 11% on Amazon, to 865. “While AMZN continues investing in Prime, Q1 results were a nice reminder of its huge potential,” Pitz wrote in a research note Friday. “Increasing Prime usage drove revenue and unit growth acceleration as broad product selection (enhanced by Fulfilled By Amazon sellers), digital content and flexible delivery options attract users to Amazon and keep them buying.” IBD Take: Amazon.com has a mundane Composite Rating but still looks good. Check out Stock Checkup.  John Blackledge, a Cowen analyst, upped his price target to 830 from 750, citing the company’s guidance — which was largely above what Wall Street expected — and the fact that Amazon of late has posted sales near or above the high end of its guidance. Amazon Web Services, the company’s cloud computing operation, is slowly dwarfing its Amazon’s core e-tail business. According to Wall Street Journal financial editor Dennis Berman, AWS is more profitable than the company’s core operations, though it accounts for only 15% of the sales. “Could AWS be worth more than IBM?,” he tweeted Thursday . IBM Q1 sales were $18 billion. AWS revenue spiked 64%, to $2.57 billion. Alphabet ( GOOGL ), via its Google unit, and software giant Microsoft ( MSFT ) have aggressively been competing with AWS.

Before Tesla Motors Reports Earnings, You Need To Know This

Now that it’s impressed the world with higher-than-expected demand for its new Model 3, Tesla Motors ( TSLA ) is set to report its quarterly results after the close on Wednesday. Analysts expect the luxury electric car maker’s per-share loss to widen to 57 cents amid production and Gigafactory investments. Revenue is projected to jump 45% to nearly $1.6 billion. The jump marks a third straight quarter of faster top-line growth. Tesla cleared a cup-with-handle base with a 239.98 buy point on April 1. Shares continued to climb the next few days but have pulled back, briefly undercutting the buy point Friday intraday. Positive results could potentially send shares to their highest level this year, while negative results could send the stock back to its 200-day and 50-day lines, which are close to converging. Meanwhile, Tesla partner Mobileye ( MBLY ) reports before the open on Thursday. The maker of advanced driver assistance systems is also working with other automakers on their autonomous and semi-autonomous car efforts. Earnings are projected to pop 75% while revenue increases 61%. Mobileye stock is trading about 40% below its all-time high reached last August, but the stock has rallied sharply from its February low. And Tesla chip supplier Nvidia ( NVDA ) is extended 8% from a cup-with-handle base buy point initially cleared in March. Nvidia shares are dropping 2% in quick trade Friday, ahead of its quarterly report on May 12.

Skyworks Guidance Lags By $50 Mil On Petering Apple iPhone Demand

Apple ’s ( AAPL ) “iPhone drag” tugged Skyworks Solutions ’ ( SWKS ) fiscal Q3 guidance by $50 million late Thursday, prompting shares of radio-frequency chip rivals Broadcom ( AVGO ) and Qorvo ( QRVO ) to topple early Friday. Skyworks stock led a broad Apple chip sphere fall, down 4.5%, near 68, in morning trading on the stock market today . Shares of competitors Broadcom and Qorvo were down a respective 2% and 2.5%. NXP Semiconductors ( NXPI ), Qualcomm ( QCOM ) and InvenSense ( INVN ) stocks followed, down 1%, 3% and 4%, respectively. Apple stock was down 2%. For its fiscal Q2, which ended April 1, Skyworks reported $775.1 million in sales and $1.25 earnings per share minus items, in line and topping the consensus of 25 analysts polled by Thomson Reuters for $775.6 million and $1.24. But EPS slipped to single-digit growth for the first time in 13 quarters, rising 9% year over year. Sales rose 2%, in the single-digit range for the first time in 14 quarters. Both metrics have decelerated for five consecutive quarters. Current-quarter guidance for $750 million in sales and $1.21 EPS ex items would be down 7% and 10%, respectively, vs. the year-earlier quarter. On a year-over-year basis, sales have never declined in the past five years. EPS has declined twice, but this quarter’s decline would be the biggest. And both metrics lagged the consensus for $800.5 million and $1.32. Mizuho analyst Vijay Rakesh blamed the “iPhone drag” for Skyworks’ weak guidance. On Tuesday, Apple reported its first year-over-year decline in iPhone sales and its first quarterly revenue drop in 13 years. Apple CEO Tim Cook said Tuesday that the company planned to cut channel inventories in the June quarter “in light of the macroeconomic environment.” Late Tuesday, supplier Cirrus Logic ( CRUS ) offered Q3 guidance that also missed Wall Street views. But Skyworks expects a strong September quarter, with 20% and 40% content gains at Samsung and Huawei. On average, Chinese smartphones are growing content by 20% year over year, Rakesh wrote in a research report. Rakesh cut his price target on Skyworks stock to 99 from 105 but reiterated a buy rating. Cowen analyst Timothy Arcuri estimates that 40 million to 50 million iPhones will be sold in the June quarter, leading to better upside in Skyworks’ fiscal Q4. But he adds that Qorvo might be a stronger RF competitor now. Both analysts suggest that Skyworks look to diversify amid the slowing Chinese and iPhone markets. Arcuri reduced his price target on Skyworks stock to 76 from 78 and kept his market perform rating.