Archive for July, 2012

FA Notes

July 31st, 2012 No comments

Market –0.43%

-Chicago PMI 53.7 vs. 52.5 est., 52.9 prior. New orders 52.9 vs. 51.9 prior

-July consumer confidence 65.9 vs. 61.5 est., prior 62.0 revised to 62.7

-June Core PCE y/y 1.8% vs. 1.8% prior

-German Govt: No Need to Grant ESM Banking License [DJ-WSJ]

-Bill Gross bashes equities Link

CMI call: China govt steps have been less than previous times. No longer expect ANY improvement in China demand 2H of year. continued weakness Brazil China and slowing orders in U.S.China govt steps have been less than previous times. No longer expect ANY improvement in China demand 2H of year. U.S. order rates trended down in April. Stayed down through all of Q2. Recently (July) picked back up a little bit (but volatile) larger U.S. retail customers sticking with their 2H guidance and orders so far debate within Chinese govt on what they want to do with stimulus program. Last stimulus "over-stimulated" "waste" "inflation" their "view has dimmed" on China stimulus driving demand Q4 of this year, probably next year now. last few weeks "remain volatile"

COH call: overall decline in the rate of traffic late in the quarter particularly in June. More promotional activity in May by competitors. environment to be increasingly promotional macro wise in FY13. "more promotional environment" going forward have to respond. expect double digit sales growth in FY13, gross margin 73% range, SGA higher. Op margin compression to 31%. Q1 most challenging. FY13 capex $250M. Not giving specific guidance. Macro softening, North America muted. FY13 "investment year" (June quarter) "economic backdrop clearly softened" in U.S. Re-instated in-store couponing in factory stores

CRUS call: call: ship in to customer takes 1/2 quarter to a quarter before final product gets shipped out by customer. analyst asked about strength in tablet for next quarter, they won’t announce their customers [Apple iPad Mini!] devices LOL!. September quarter "ramp a variety of new products".

Categories: News

FA Notes

July 30th, 2012 No comments

Market –0.05%

I guess CRUS won some new business either AAPL iPhone 5 or iPad mini. HUGE GUIDANCE raise $180M next quarter vs. $130M

-Reuters insiders accounts at ECB. Less dovish than what market thought last week Link on ECB council internal strife Link

-Dallas Fed manufacturing survey –13.2 vs. 2.5 est., 5.8 prior

-iMore says iPhone 5 to be released on September 21 and iPad Mini to be announced on September 12 Link

-Best Buy founder Richard Schulze recruiting executives for Best Buy buyout Link

-Rumored iPhone 5 enclosure video Link

Krugman wants more QE and signal from the Fed it will tolerate higher inflation rate in the medium term. He also wants to devalue the dollar used to be new set of EU measures would buy you 6 months of peace in markets. Now you are lucky if it’s 6 days. Half life falling. we are heading towards moment of truth probably involving Greece who is close to the edge. Greece will run out of money, lost cause. that will lead to bank runs in Spain and Italy. Will Germany be willing to spend the Trillions to stop it or not is key question. he thinks the moment of truth is very soon at very latest early next year and doesn’t know what Germany will do. thinks if Obama is elected very highly likely he will let the fiscal cliff happen for 1-2 months to get Republicans to compromise



Categories: News

FA Notes

July 27th, 2012 No comments

Market +1.91%

-GDP 1.5% vs. 1.2% est., prior 1.9% revised to 2.0%

-Consumer sentiment 72.3 vs. 72 est., prior 72

-ECB Draghi to hold talks with Weidmann on bond purchases Link

Categories: News

FA Notes

July 26th, 2012 No comments

Market +1.65% off ECB Draghi comments.

-ECB Draghi says: “Within our mandate, the ECB is ready to do whatever it takes to preserve the euro,” he said, adding: “believe me, it will be enough” Link

-Durable goods ex-transportation –1.1% m/m vs. 0.2% est. Prior revised to 0.8% from 0.4%

-Jobless claims 353K vs. 380K est., prior revised to 388K vs. 386K

-Pending home sales –1.4% m/m vs. 0.9% est., prior revised to 5.4% vs. 5.9%

-Kansas City Fed manufacturing index 5 vs. 4 est., 3 prior

-Rumor from China paper saying iPhone 5 may be delayed Link

-Bronte Capital goes from big long to short on Microsoft Link

-Anandtech Google Nexus 7 review Link

AMZN last 5 quarters sales y/y growth rate: 51% Q2-11, 44% Q3-11, 35% Q4-11, 34% Q1-12, 29% Q2-12, guides Q3-12 mid-point 25%

AMZN North America sales held up. 36% y/y growth in Q1 and 36% y/y in Q2. International sales slowed big time 31% in Q1 to 22% in Q2

AMZN Media sales slowed +19% y/y Q1 to +13% y/y Q2 (lowest y/y since Q4-10). Electronics/general sales slowed +43% y/y Q1 to +38% y/y Q2

AMZN conf call: “In terms of sales taxes, any impact that we certainly would expect to see would be included in guidance that we are giving for Q3”

Categories: News

FA Notes

July 25th, 2012 No comments

Market –0.03%

V PR: Visa credit/debt growth ex-FX March quarter 12.9%, June quarter 8.1%. Processed transactions March quarter 8%, June quarter 1%

Clear from this CAT conf call, biz trends still not good, but mgmnt in "hope mode" for turn in 2013 due to global govt/central bank actions

ZNGA PR: Bookings $302M vs. $337M est. 2012 bookings outlook $1.15-1.225B vs. $1.425-1.5B previous guidance

Hilsenrath: don’t want to give people wrong impression that something will happen right away on Fed, may wait till September to decide

-Gabe Newell of Valve Software bashes Windows 8 Link

“I think Windows 8 is a catastrophe for everyone in the PC space. I think we’ll lose some of the top-tier PC/OEMs, who will exit the market. I think margins will be destroyed for a bunch of people”

-Amazon courts game developers Link

Categories: News

FA Notes

July 24th, 2012 No comments

Market –0.9%

-U.S. PMI Mfg. 51.8 vs. 52.6 est., 52.9 prior

-Richmond Fed –17 vs. 0 est., –3 prior

-France Mfg. PMI 43.6 vs. 45.6 est., 45.2 prior

-Germany Mfg. PMI 43.3 vs. 45.3 est., 45.0 prior

-EU Mfg. PMI 44.1 vs. 45.3 est., 45.1 prior

-HSBC China Mfg. PMI 49.5 vs. 48.2 prior

-Sarepta may found treatment for muscular dystrophy Link

-Reuters: Greece will need more debt restructuring – EU officials Link

-WSJ Hilsenrath: Central-bank officials could take new steps at their meeting next week, July 31 and Aug. 1, though they might wait until their September meeting to accumulate more information on the pace of growth and job gains before deciding whether to act. Link

-Greenlight Q2 letter Link

$AAPL call: iPhone ASP down due to higher mix of lower-priced models, FX, and weak econ. iPad ASP higher mix of iPad2, more indirect, FX

$AAPL call: sold 1.3 million Apple TVs last quarter, 4M fiscal year to date

$AAPL call: Tim Cook says has yet to see a non-iPad tablet get traction [Tim Cook is wrong on this one, Google Nexus 7 IS GETTING TRACTION]

$AAPL call: economy in Europe not doing well, Australia/Brazil/Canada weaker too, FX hurt $200M q/q net of hedges

Sounds like iPad Mini may come out in $AAPL September quarter given gross margin guidance and comments on conference call

$AAPL call: geography that did not perform well was Europe. UK solid 30%, France/Greece/Italy particularly poor, Germany single digit pos

$AAPL call: sell-in was less than sell-through by 300K units

$AAPL call: iPhone sales impacted by speculation of new upcoming product

$AAPL call: greater China 2/3rd of Asia revenue. $2.2B q/q decline iPhone, 1/2 of that channel inventory driven

$AAPL call: gross margin 38.5% guidance next quarter 1) fall transition 2) FX 3) ex-warranty benefit 4) back to school promotion

Given this $AAPL guidance iPhone 5 likely won’t launch till December quarter. iPhone 4S launched in October 2011

$AAPL call: iPad 2 sales were particularly strong

$AAPL sales grew 22.6% y/y in June qter vs. 58.9% y/y in March qter. Worst quarterly sales growth since September 2009

$BWLD PR: "higher year-over-year wing costs in the second quarter moderated our net earnings" Who warned u bout higher wing costs last week?

Reading previous $UPS transcripts, the lightweight domestic volume numbers are primarily e-commerce B2C driven. Q2 +25% y/y vs. Q1 +30% y/yReply

$UPS call: biggest change in outlook during the quarter was the U.S. domestic deceleration more than Europe or Asia

$UPS call: it will get tougher before it gets better

$UPS call: U.S. exports to Europe will be really weak going forward

$UPS call: exports growing slower rate than global GDP is really unusual. Europe and U.S. have low demand right now

$UPS call: small and medium size businesses in U.S. suffering right now due to the uncertainty

$UPS call: expect U.S. domestic volume to decelerate going forward.. op margin will be less than last year due to mix shift/lower volume

$UPS call: fiscal austerity measures in southern Europe led to DOUBLE DIGIT declines (geez)

$UPS call: current trends (U.S.).. lack of B2B growth concerning going forward

$UPS call: overall GDP forecasts around the world declining. Global trade is lagging GDP, which happened once last 10 yrs (last recession)

$UPS call: current economic forecasts 2H-12 for U.S. too high. We think 1% GDP growth

$UPS call: economies around the world showing signs of weakening, customers nervous. U.S. customers uncertain

$UPS PR:"Increasing uncertainty in U.S. continuing weakness in Asia exports..debt crisis in Europe..impacting projections of econ expansion"

Categories: News

FA Notes

July 23rd, 2012 No comments

Market –0.89%


TXN PR: "Our backlog grew last quarter but orders slowed in the month of June and our backlog coverage for September is lower than normal” “the global economic environment is causing both to become increasingly cautious in placing new orders"

TXN call: R&D coming down little bit response to environment [macro]. July new orders about same level as June. New orders fell from May to June. broad-based weakness. North America strongest, then Asia/Japan, Europe was down. Auto/TV down a bit, industrial flat. have Win RT ported over to OMAP architecture. some growth in disk-drives in Q2, hard-drive TAM "appears to be softening" now. Mixed signals in PC space – analog/battery management

MCD "As we begin third quarter, global comparable sales for July are expected to be positive, but less than second quarter" Q2 comp 3.7%. "we are operating in a more difficult global environment" they may miss their full year operating profit target less pricing power in Europe due to austerity. France and Germany feeling the pressure of ongoing Europe difficulties. in China consumers are reacting more cautiously as economy has slowed, especially in Tier 1 cities. "eating out market is simply declining" Europe. first time seeing broader based.. global piece.. across the board [slow-down]. some of austerity measures in Europe include additional payroll taxes and charges. "we’re seeing wage pressure in virtually every market around the world" "Italy is a tough market for us. Italy right now" Why does $MCD trade at 16Xs 2012 EPS with 0% sales growth, margins getting worse, and macro getting worse?

VMW call: will continue investing and hiring in 2H-12. remain cautious especially European markets, overall deal pipeline very strong for 2H. results in Europe mixed. Better in UK, France, Russia

GS analyst lowers AMZN 2012 Kindle e-reader forecast to -50% y/y vs. +17% y/y prior

-Reuters: Amazon’s mobile ambitions grow Link

-Inside story of Digg’s Kevin Rose Link

-Spain and Italy reinstate short-selling bans Link

Categories: News

FA Notes

July 20th, 2012 No comments

Market –1.01%. Spain’s 10 year bond yield rises to 7.293%

CMG earnings call transcript Link Same-store sales comp 8% vs. 10% estimate
”quarter comp was primarily driven by higher menu prices, which added 4.6% to the comp”
”Sales trends slowed during the second quarter, we believe, as a result of a general slowing of the economy and reduced consumer spending”
”So far in July, we’re seeing comp transaction trends when you take out the impact of price at about the same level overall as in Q2”
”In terms of full year inflation, while costs have been relatively stable overall so far this year, the recent extreme weather will likely put pressure on our food costs later in the year and into 2013”
”In addition to the higher expected cost of avocados and beef we discussed in our last call, there will likely be additional pressure on dairy and chicken.”
”We’re seeing a slowdown. I mean, there’s no other way around it. We were humming along nicely in the first quarter. We were humming along nicely in April. And then we saw a slowdown.”

AMZN launched country specific sites in UK/Germany 1998, France/Japan 2000, Canada 2002, China 2004, Italy 2010, Spain 2011

EBAY exposure 47% U.S., 13% Germany, 14% UK, 15% Asia (big in Korea). Not much Europe outside of UK/Germany. Not great indicator for macro trends in Europe

GOOG average cost-per-click Q1 -12% y/y, Q2 -16% y/y. Paid clicks Q1 +39% y/y Q2 +42% y/y

SNDK call: guides Q3 to $1.2B vs. $1.22B estimate. 2013 industry bit growth 40-50% vs. 50-60% before

-SEC charges STEC CEO of insider trading Link

-CNN: Shoppers say “No” to Amazon collecting state sales tax Link

"If you take away my *only* reason for shopping at Amazon, what do you think is going to happen to myself and millions of others?" writes Roger of Petaluma, Calif.

Robert of Redlands, Calif., says he shops on Amazon up to five times a week, buying anything from coffee to detergent to camera lenses. But once the company starts collecting tax in the Golden State, Robert will switch to other online retailers that don’t charge taxes.

"If [I] buy from local stores, I can get the products I want immediately, with no shipping delay, and skip the shipping costs," said Todd, noting that he’s bought lots of unnecessary things over the years to qualify for Amazon’s free shipping threshold. "Amazon will cease to have an advantage for me," he said.


The historical seasonal Q1 to Q2 decline in chicken wings prices is not happening this year. In fact it looks like wings prices will go even higher as chickens feed on corn and soy, which are hitting all-time record price highs.

Categories: News

FA Notes

July 19th, 2012 No comments

Market +0.27%

-farmer source says crop plane fuel prices went from $5.10 to $5.60 in the past week

-Jobless claims 386K vs. 365K estimate, prior 350K revised to 352K

-Existing home sales 4.37M vs. 4.65M estimate, prior 4.55M revised to 4.62M

-Philadelphia Fed survey –12.9 vs. –8 estimate, –16.6 prior

-Barton Biggs words of wisdom Link

-Bridgewater Q2-2012 investor letter Link

-Forbes profile on Five Guys Burgers Link

-Forbes profile on Mary Meeker Link

-Fortune debate between Schmidt and Thiel Link

-Digitimes estimates 20-25M iPhone shipments in Q3-12 Link

-TSMC sees 6-8% sales rise in Q3, but cautious going forward on macro Link

Categories: News

FA Notes

July 18th, 2012 No comments

Market +0.67%

IBM operating profit +14% y/y, sales -3% y/y, services signings $13.7B -4% y/y vs. $13.63B estimate

IBM call: quarter relatively linear, June was stronger than rest of quarter. revenue growth Americas -1%/1% ex-FX, Europe -9%/flat, Asia 2%/4%

-Muddy Waters report on New Oriental Education and Technology Link

-Taiwan touch panel chip maker Elan raises outlook due to Google Nexus 7 tablet Link

-CNN Money: Amazon to charge state sales tax Link

Categories: News