GE revenue beats expectations, calming nerves

WOONSOCKET, R.I., Fri Apr 19, 2013 — Strong sales to aviation customers helped General Electric Co.’s first-quarter revenue beat Wall Street expectations on Friday, assuaging fears of a miss after a lukewarm report on March U.S. factory activity.

The world’s biggest maker of jet engines and electric turbines said revenue rose slightly to $35 billion, surpassing the $34.51 billion analysts had expected, according to Thomson Reuters I/B/E/S.

“That is a beat on revenue, and that’s important because the Street has been very worried about revenue numbers at industrial firms because the quarter appears to have tailed off in March,” said Jack DeGan, chief investment officer at Harbor Advisory Corp. in Portsmouth, New Hampshire, which owns GE shares.

The Institute for Supply Management said earlier this month that U.S. factory activity grew at the slowest rate in three months in March, suggesting the economy lost some momentum at the end of the first quarter.

While investors and analysts await more information on sales from GE Chief Executive Jeff Immelt on an earnings conference call, GE said in a statement that orders from aviation customers jumped 47 percent and orders from energy customers rose 24 percent in the quarter.

Target warns 1st-quarter profit will miss forecasts

MINNEAPOLIS, Minn., Tue Apr 16, 2013 — Retailer Target Corp. on Tuesday warned first-quarter earnings would miss expectations, after weaker-than-expected sales of seasonal and weather-sensitive items, sending shares down 1 percent.

Target said adjusted earnings per share would come in slightly below the low end of its prior outlook of $1.10 to $1.20, and same-store sales would be about flat.

Target stood by its full-year forecast for adjusted earnings per share of $4.85 to $5.05 per share.

The company expects to report earnings on May 22.

Shares fell 1.1 percent to $67.70 in premarket trading.

Fewer troubled mortgages hobble banks in first quarter

WASHINGTON, Wed Jun 27, 2012 – U.S. banks held fewer troubled mortgages in the first quarter of 2012, according to a report issued on Wednesday by the Office of the Comptroller of the Currency, as loans serviced by national banks performed better in the first three months of the year.

The report said the overall quality of serviced mortgages improved, and the percentage of serviced loans that were current and performing at the end of March was 88.9 percent, the highest level in three years. The improvement was due to an uptick in the economy and continued emphasis on programs intended to keep borrowers in their houses, the OCC said.

Overall, the percentage of mortgages that were 30 to 59 and 60 to 89 days delinquent also decreased to their lowest levels since the OCC began tracking the mortgage data in the first quarter of 2008. The percentage of mortgages in the portfolio that were 30 to 59 days delinquent at the end of the first quarter decreased by 17.3 percent from the previous quarter and by 3.8 percent from a year earlier.

“This improvement can be attributed to several factors, including strengthening economic conditions during the quarter, seasonal effects, servicing transfers, and the ongoing effects of both home retention loan modification programs as well as home forfeiture actions,” the OCC said in the quarterly report.

The number of foreclosures in process decreased from a year ago, edging down 1.8 percent from the previous quarter and by 8.1 percent from a year earlier.

However, the percentage of mortgages in the process of foreclosure at the end of the first quarter of 2012 increased, rising by 1.8 percent from the previous quarter and 2.3 percent from a year earlier.

First quarter productivity falls more than expected

WASHINGTON, Wed Jun 6, 2012 – U.S. nonfarm productivity fell more than expected in the first quarter as companies gave more hours to employees but only modestly expanded output, revised data from Labor Department showed on Wednesday.

Productivity slipped at a 0.9 percent annual rate, a sharper decline than the 0.5 percent initially reported by the government.

Analysts polled by Reuters had expected productivity to decline at a 0.7 percent rate during the period.

Employers slashed payrolls during the 2007-09 recession, helping fuel a spike in productivity. But the increase in output-per-hour faded last year, and productivity has declined in three of the last five quarters.

U.S. stock index futures were up on speculation the European Central Bank could act on the euro zone debt crisis. The euro pared gains against the dollar, while U.S. government debt prices were steady at lower levels.

Economists are divided about what recent weakness in productivity will mean for the economy.

One the one hand, it could show that employers are squeezing about all they can out of their current staffs and will need to boost hiring.

But there is also a darker possibility: It could be a sign that the burst in hiring that began last year will continue to wane.

Groupon shares jump on upbeat first quarter results

CHICAGO, Tue May 15, 2012 – Groupon Inc. shares jumped 22 percent in premarket trade on Tuesday after the daily deals company posted its first quarterly profit as it signed up more customers and merchants.

“While billings, revenue, margins, and guidance all met or exceeded, signs of accelerated North American revenue shows that the company’s technology efforts around personalization and, to a lesser extent, mobile and rewards, are paying off,” Evercore Partners analyst Ken Sena wrote in a note.

Sena raised his price target on the stock to $17 from $15 and kept a “buy” rating.

Analysts have been particularly concerned that growth was slowing in Groupon’s relatively more mature North American business. However, Groupon said on Monday North America revenue rose 33 percent for the first quarter — the strongest growth in a year.

“Groupon appears to be gaining market share in general,” Benchmark analyst Clayton Moran said.

Groupon’s take rate — which measures how much of the money it keeps after sharing cash with merchants running its deals — rose to 41.3 percent from 40 percent in the previous quarter.

Shares of the Chicago-based company rose $2.55 to 14.29 in trading before the bell on Tuesday. The stock closed at $11.74 on Monday on the Nasdaq.

Wholesale inventories data points to first quarter GDP downgrade

WASHINGTON, Wed May 9, 2012 – Stocks of unsold goods at wholesalers rose modestly in March, according to government data on Wednesday that suggested a downward revision to the initial first-quarter growth estimate.

Wholesale inventories increased 0.3 percent to a record $480.4 billion, the Commerce Department said, after an unrevised 0.9 percent rise in February.

The increase was half what economists polled by Reuters had expected, leaving them to conclude that the government would likely lower its first-quarter GDP estimate to an annual pace of 1.9 percent from the 2.2 percent rate it reported last month.

The change in inventories is a key component in the calculation of GDP. However, the actual size of the revision would be depend on data next week on overall business inventories for March.

Trade data for March to be released on Thursday will also have an impact on the first-quarter GDP estimate. The government used estimates for both business inventories and the trade balance for its first GDP estimate, published last month.

Economists said the wholesale numbers, particularly the ex-autos component that goes into the GDP calculation, had come in softer than the government’s assumptions.

GM first quarter profit beats Street on strong U.S. demand

DETROIT,| Thu May 3, 2012 – General Motors Co reported a first-quarter profit that surpassed forecasts as it was able to boost vehicle prices, especially in North America, and cut losses in its troubled European operations.

GM, whose shares rose 3.1 percent in premarket trading, also said the U.S. economy was improving and it expected its core North American results in the second and third quarters to largely match the first quarter due to scheduled downtime at its large truck plants.

“We’re clearly seeing some improvement in the (U.S.) economy,” Chief Financial Officer Dan Ammann told reporters. “It’s a modest underlying improvement, but it’s patchy and it won’t necessarily all go in a straight line.”

The quarter included the impact of $800 million in higher vehicle pricing and lower consumer incentives, half of which came in North America. Last year, GM offered heavy consumer incentives to drive sales in the U.S. market, something it did not do this year.

Excluding one-time items related to the impairment of goodwill primarily in Europe, the No. 1 U.S. automaker reported a profit of 93 cents per share.

Analysts, on average, expected GM to earn 85 cents per share, according to Thomson Reuters I/B/E/S.

Net income fell to $1 billion, or 60 cents a share, from $3.15 billion, or $1.77 a share, in the same quarter a year earlier. Last year’s quarter included a one-time gain of $1.5 billion related to the sale of stakes in Delphi and Ally.

Revenue for the quarter was $37.8 billion, up 4.4 percent from $36.2 billion a year ago.

Kellogg cuts full-year outlook; first quarter report disappointing

BATTLE CREEK, Mich., Mon Apr 23, 2012 – Kellogg Co. cut its full-year outlook on Monday, citing a weaker-than-expected first-quarter performance, and its shares fell 6.3 percent.

The world’s largest cereal company said net sales fell 1.3 percent in the quarter, with earnings of $1 per share.

Excluding a 5 cent-per-share benefit from hedging activities, Kellogg’s profit was 95 cents per share. Analysts on average were expecting 99 cents per share, according to Thomson Reuters I/B/E/S.

Kellogg, which makes Corn Flakes cereal, Cheez-It crackers and Eggo frozen waffles, said it now expected full-year net sales to rise 2 percent to 3 percent, with operating profit falling 2 percent to 4 percent.

It expects reported earnings to range from $3.18 to $3.30 per share.

“We are obviously disappointed with the performance of the company in the first quarter of 2012,” Kellogg Chief Executive John Bryant said in a statement. “We faced more significant challenges in both Europe and in some categories in the U.S. than we expected.”

The company said it also wanted to continue to invest for future growth.

Kellogg shares fell to $50.57 in premarket trading from their close on Friday at $53.99.

U.S. sales boost McDonald’s Corp. first-quarter profit

OAK BROOK, Ill., Fri Apr 20, 2012 – McDonald’s Corp. reported higher quarterly profit on Friday, paced by strong sales at established restaurants in the United States and Europe.

Quarterly sales at restaurants open at least 13 months were up 7.3 percent, more than the 6.7 percent increase expected by analysts polled by Consensus Metrix. Comparable sales rose 8.9 percent in the United States and 5 percent in Europe.

Companywide, the restaurant chain expects the momentum to continue in April, forecasting comparable sales will be up 4 percent for the month.

A difficult economy in Europe, the company’s biggest market, had raised concerns that McDonald’s patrons might pull back.

“People have been most concerned about Europe and it looks like it’s OK,” said Sara Senatore, an analyst with Sanford C. Bernstein & Co.

In Asia/Pacific, Middle East and Africa, comparable sales were up 5.5 percent.

Shares of McDonald’s rose 1.7 percent to $96.95 in premarket trading on Friday.

Net income at the world’s biggest fast-food chain rose to $1.27 billion, or $1.23 per share, during the first quarter, up from $1.21 billion, or $1.15 per share, a year earlier. That was in line with analysts’ average forecast, according to Thomson Reuters I/B/E/S.

Southwest Air does not see first quarter profit due to fuel

DALLAS, Tue Mar 13, 2012 − Southwest Airlines Co. does not expect to report a profit for the current first quarter because of high fuel prices, the company’s finance chief said on Tuesday.

The carrier, which acquired AirTran last year, said it expects fuel costs of about $3.50 a gallon for the first period, about 15 cents higher than its prior forecast.

“If you look at the last few fare increases, they’ve become less effective,” CFO Laura Wright told a JPMorgan Aviation, Transportation and Defense conference that was broadcast over the Internet.

“No surprise; any business that raises fares that many times in a short period of time would expect to see that,” Wright added. She cited 10 rounds of fare rises in the last year.

The company said passenger revenue per available seat mile, an important measure, rose 4 percent in February, weaker than expected and compared with a 7 percent rise for January. Wright said close-end bookings toward the end of February were weaker.

“For March, bookings remain good but we are cautious,” Wright said. She added it was too early to discern if the February weakness was a “sign of something going on in the economy” or an anomaly.

Oil prices traded up on Tuesday, with Brent crude near $126, as investors awaited comments from the U.S. Federal Reserve that may confirm an improving outlook.