Today is another huge earnings day. Dozens of large US companies are reporting earnings. Most companies are reporting third quarter earnings. Below we highlight the forecasts for many of the noteable companies. Earnings Calendar for Wednesday, October 24, 2012, including, General Dynamics Corporation (NYSE:GD), AT&T Inc. (NYSE:T), The Boeing Company (NYSE:BA), Bristol Myers Squibb Co. (NYSE:BMY), Eli Lilly And Co. (NYSE:LLY), Kimberly Clark Corp (NYSE:KMB), Lockheed Martin Corporation (NYSE:LMT), NASDAQ OMX Group, Inc. (NASDAQ:NDAQ), T. Rowe Price Group, Inc. (NASDAQ:TROW), Northrop Grumman Corporation (NYSE:NOC), Praxair, Inc. (NYSE:PX), and Lorillard Inc. (NYSE:LO).
Before Market Open:
- General Dynamics Corporation (NYSE:GD) is an aerospace and defense company that offers a portfolio of products and services in business aviation. The FAA awarded Gulfstream a Type Certificate for its G650 aircraft on Sept 7, clearing the way for entry into service later this year. The $64.5 million plane is the leader in the large cabin long range market and could be Gulfstream’s largest revenue line by 2014. On a normalized basis, the delivery of each General Dynamics Corporation (NYSE:GD) aircraft could generate $0.03 per GD share. Jefferies’ EPS estimates remain unchanged at $7.05 and $7.70 for 2012 and 2013. Gulfstream may account for about 28% of 2012 estimated operating income of $3.8 billion and around 30% of 2013’s operating income of $4.1 billion. Selling at under 10x 2012 their estimated EPS, the shares are trading at discount to peers, despite having an attractive growth vehicle in Gulfstream. For the six months ended 01 July 2012, General Dynamics Corporation (NYSE:GD) revenues decreased 1% to $15.5B. Net income before extraordinary items decreased 7% to $1.2B. Revenues reflect Information Systems and Technology segment decrease of 12% to $4.97B, Combat Systems segment decrease of less than 1% to $4.06B. Net income also reflects Information Systems and Technology segment income decrease of 23% to $444M.
- AT&T Inc. (NYSE:T) reports earnings before the bell. BAML analysts project 5m and 7m iPhone activations at AT&T Inc. (NYSE:T) in 3Q12 and 4Q12, respectively. Verizon Communications Inc. (NYSE:VZ) 3Q iPhone activations of 3.1m fell short of their 4.2m forecast. They are looking for commentary with regard to 4Q service margin expectations and the impact on the handset upgrade rate. AT&T Inc. (NYSE:T) has increased its dividend 27 straight years and recently authorized a 420m share repurchase program. Investors are looking for insight with regard to management’s preference for returns to shareholders and accessing the capital markets. Deutsche Bank analysts expect EPS of $0.60 (cons $0.60), down 2% YoY due to the subsidy impact of an early iPhone launch, partially offset by a lower share count as a result of AT&T Inc. (NYSE:T)’s buyback program. They are focused on four issues: (1) visibility on 4Q wireless margins based on expected smartphone sales (est 17.1M YTD vs. ‘12 guidance of 25M); (2) AT&T Inc. (NYSE:T)’s outlook for ARPU growth based on shared data plan adoption; (3) visibility on wireline enterprise revenue growth; and (4) uses of cash in coming quarters, including spectrum purchases, buybacks and capex.
- The Boeing Company (NYSE:BA) is scheduled to report 3Q12 results tomorrow before the market opens with a conference call scheduled to follow at 10:30 a.m. EDT. Stifel Nicholas is looking for The Boeing Company (NYSE:BA) to report EPS of $1.03 on revenue of $20.0 billion, including $12.3 billion from commercial aircraft compared to consensus EPS of $1.12 on revenue of $20.1 billion. Their revenue forecast represents an increase of 12.8% overall and about 29.1% from commercial airplanes. Given the timing of 3Q deliveries, and depending upon deliveries near the holidays, there’s a decent chance that 4Q could be higher by one 777, three 787s, and as many as five 737s. The Boeing Company (NYSE:BA) has recorded 1,012 gross orders through October, and received 83 cancellations for a net of 929, which is now eight units ahead of the figure reached for full year 2011. Citigroup analyst, Jason Gursky, notes that the backlog and working capital are built, difficult development projects are coming to a close, and execution is in keen focus. Now it’s time to generate cash returns for shareholders, and with free cash yields likely pushing the mid-teens by mid-decade (on current prices), he views this as highly likely. He expects Board-level cash deployment decisions, continued 787 execution, and increasing investor confidence with the company’s backlog to act as catalysts.
- Bristol Myers Squibb Co. (NYSE:BMY) will report its 3Q12 earnings on Wednesday morning at 7:30 am and host an investor conference call at 10:00 am. Goldman Sachs expects 3Q2012 EPS of $0.40 vs. consensus at $0.42 and full year 2012 EPS of $1.94 vs. the Street at $1.93 and guidance of $1.90 – $2.00. They expect Bristol Myers Squibb Co. (NYSE:BMY) 3Q12 revenues of $3.9 bn just below $4.0 bn consensus, and fullyear 2012 revs of $17.9 bn also just short of consensus at $18.0 bn. In 3Q, they expect an FX headwind of -5% to ex-US revenues (-2% globally) but the main top-line story will be difficult comps in the wake of Plavix patent loss. Investors will expect an update on AMLN integration and outlook for sales ramp-up for Byetta/Bydureon with an increased Bristol Myers Squibb Co. (NYSE:BMY)/AstraZeneca plc (NYSE:AZN) sales force. For the six months ended 30 June 2012, Bristol Myers Squibb Co. (NYSE:BMY) revenues decreased 7% to $9.69B. Net income decreased 8% to $1.75B. Revenues reflect United States segment decrease of 11% to $6.04B, Europe segment decrease of 4% to $1.75B. Net income also reflects Litigation charges/(recoveries) increase from $106M (income) to $22M (expense), IPRD impairment increase from $15M to $103M (expense).
- Eli Lilly And Co. (NYSE:LLY) will report its 3Q12 earnings on Wednesday morning at 6:30 am and host an investor conference call at 9:00 am. Goldman analysts expects 3Q2012 EPS of $0.79 vs. consensus at $0.83. For full year 2012 they expect EPS of $3.36 vs. $3.39 consensus, within guidance of $3.30 – $3.40. They expect 3Q12 revenues of $5.62 bn, roughly in line with consensus, and full-year 2012 revs of $22.7 bn also in line with consensus. In 3Q, Goldman expects an FX headwind for Eli Lilly And Co. (NYSE:LLY) of -5% to ex-US revenues (-2% globally) but favorable FX impact on gross margins and operating expenses may neutralize any FX hit to the top-line and potentially even benefit EPS. The key focus will likely remain on (1) the next steps for Eli Lilly And Co. (NYSE:LLY)’s highrisk/ high-reward Alzheimer’s drug solanezumab (investors continue to expect LLY to need an additional large P3 study for filing), (2) potential patent extension for Alimta, and (3) cost cutting efforts (SG&A and R&D). For the six months ended 30 June 2012, Eli Lilly And Co. (NYSE:LLY) revenues decreased 7% to $11.2B. Net income decreased 14% to $1.93B. Revenues reflect Net product sales decrease of 8% to $10.87B. Net income also reflects Research and development increase of 4% to $2.47B (expense), Other income &, expense increase from $11.2M to $27.5M (expense), Less interest capitalized during the per decrease of 13% to $10.8M (income).
- Kimberly Clark Corp (NYSE:KMB) will report quarterly earnings before the market opens today. 3Q12 EPS: $1.33 [$1.30-1.36 range; Barclays = $1.32] 3Q12 sales growth: -0.7% [-2.2-+1.1% range; Barclays = +0.1%, +4.4% organic]. Investors will focus on any early commentary on the outlook for 2013, performance of new launches in Adult and Feminine Care, organic revenue growth & momentum in emerging markets and results in KC-Professional & outlook on the macro environment. Barclays analysts expect strong organic revenue growth, as was the case in 2Q12, +4.5% driven by +3.0% volume growth and +1.5% price/mix. Personal Care should post the strongest results among the divisions (+5.5% organic) on +4.0% volume growth and +1.5% price/mix driven by new private label contracts & strong wipes performance in Europe, and continued momentum in KC-International. For Consumer Tissue, they are forecasting +2.5% organic sales growth driven by +1.5% volume and +1% price/mix, as the segment laps Cottonelle de-sheeting and stepped up pricing, making for an easy volume comparison (as corroborated by US Nielsen scanner data; Toilet Tissue volume grew ~3.7% in 12 week ending 9/29/12). KC-Professional, the most cyclically exposed of Kimberly Clark Corp (NYSE:KMB)’s businesses, should post solid +4.0% organic growth despite the recent slowing in domestic business spending and facing its toughest comparison of the year (+5.5% organic growth in 3Q11) due to strong momentum in emerging markets (+8.0% organic in 2Q12). Finally, with continued momentum in medical devices, they expect Health Care to post organic sales of +5.0%. Geographically, they expect KCI, Kimberly Clark Corp (NYSE:KMB)’s emerging markets business, to again post double-digit organic growth in 3Q12, even on top of low-teens growth in 3Q11.
- Lockheed Martin Corporation (NYSE:LMT) is reporting earnings Wednesday morning. Analysts forecast Q3 EPS of $1.85. Lockheed Martin Corporation (NYSE:LMT) eliminated the Electronic Systems reporting segment by dividing it into Missiles & Fire Control (MFC) and Mission Systems & Training (MST). MFC and MST will join Aeronautics, IS&GS and Space to comprise the 5 Lockheed reporting segments effective from December 31. The move will affect roughly 200 jobs, primarily executives, and will save the company ~$50m per year. Chris Kubasik, company COO and CEO heir apparent, was formerly head of the Electronic Systems Business Area. For the six months ended 24 June 2012, Lockheed Martin Corporation (NYSE:LMT) revenues increased 5% to $23.21B. Net income before extraordinary items increased 11% to $1.45B. Revenues reflect Aeronautics segment increase of 9% to $7.11B, Space Systems segment increase of 11% to $4.27B, Electronic Systems segment increase of 3% to $7.48B. Net income benefited from Electronic Systems segment income increase of 17% to $1.07B.
- NASDAQ OMX Group, Inc. (NASDAQ:NDAQ) is reporting Q3 results before the bell. Wells Fargo analysts, Christopher Harris, CFA. recently raised his EPS estimates for NDAQ to incorporate newly disclosed information. Their new estimates incorporate data on capture rates which were released following their 3Q EPS preview for the group. They are raising their 3Q12 EPS estimate for NASDAQ OMX Group, Inc. (NASDAQ:NDAQ) to $0.61 from $0.58 prior and their 2012 EPS estimate to $2.50 from $2.47. Their 2013 EPS estimate stays unchanged at $2.82. Wells Fargo maintains a market Perform rating and $23-26 valuation range. NASDAQ OMX Group, Inc. (NASDAQ:NDAQ) is a well diversified exchange company with strong franchises in select markets including a high performance technology platform. However, he views the shares as fairly valued near current trading levels.
For the six months ended 30 June 2012, NASDAQ OMX Group, Inc. (NASDAQ:NDAQ) revenues decreased 2% to $1.62B. Net income decreased 9% to $178M. Revenues reflect Market Services segment decrease of 2% to $1.35B. Net income also reflects Asset impairment charges increase from $0K to $40M (expense), Restructuring charges increase from $0K to $20M (expense). Dividend per share totaled to $0.13. Basic Earnings per Share excluding Extraordinary Items decreased.
- T. Rowe Price Group, Inc. (NASDAQ:TROW) is reporting earnings today. Gabelli & Company analyst, Macrae Sykes, estimates that T. Rowe Price Group, Inc. (NASDAQ:TROW) will generate 2012 revenue of $3.0 billion, EBITDA of $1.4 billion, and earn $3.25 per share. Sykes recently raised his earnings estimates ahead of the firm’s 3Q earnings announcement on October 24, due to market appreciation. He expects another solid quarter from T. Rowe despite the industry headwinds for active equity managers. 3Q earnings estimate for T. Rowe Price Group, Inc. (NASDAQ:TROW) is $0.84 per share, a $0.05 increase, QoQ. He expects record ending AUM of $567 billion, a 4.6% increase QoQ. T. Rowe Price Group Inc. based in Baltimore, MD, is a financial services holding company made up of asset management subsidiaries, T. Rowe Price Associates, T. Rowe Price International and T. Rowe Price Global Investment Services. As of June 30, 2012 T. Rowe Price Group, Inc. (NASDAQ:TROW) had approximately $541.7 billion of assets under management (AUM).
- Northrop Grumman Corporation (NYSE:NOC) is reporting third quarter earnings before the opening below. Analysts predict Northrop Grumman Corporation (NYSE:NOC) to report Q3 EPS of $1.69. Oppenheimer recently downgraded Northrop Grumman Corporation (NYSE:NOC). They believe that though catalysts should remain generally positive for Northrop Grumman Corporation (NYSE:NOC) through election day, its current multiple leaves little room for sustained outperformance. Looking past the elections, they believe investors could become more alert to the risks posed by sequestration. After a year of hearing sequestration catastrophe scenarios, but seeing solid results quarter after quarter, many have been lulled into believing sequestration might somehow resolve itself without materially impacting industry fundamentals. For the six months ended 30 June 2012, Northrop Grumman Corporation (NYSE:NOC) revenues decreased 6% to $12.47B. Net income before extraordinary items decreased 3% to $986M. Revenues reflect Information System segment decrease of 9% to $3.7B, Aerospace Systems segment decrease of 6% to $4.79B, Electronic Systems segment decrease of 4% to $3.47B. Net income also reflects Unallocated segment loss totaling $1M vs. income of $147M.
- Praxair, Inc. (NYSE:PX) is reporting earnings before the market opens today. BAML analysts recently reduced their 2012 and 2013 EPS estimates for Praxair, Inc. (NYSE:PX) by $0.10 to $5.65 and $6.30 respectively, on a stronger USD and weaker volumes. The street expects Praxair, Inc. (NYSE:PX) to report EPS of $1.39. Jefferies believes that Praxair, Inc. (NYSE:PX)’s approach is differentiated by its insistence on mitigating project risk and delivering a sustainable value proposition, not just chasing returns or “acting as a bank” to customers to gain share (though this would not preclude the company issuing 30-year debt to take advantage of attractive corporate debt markets). The company insists it is maintaining its hurdle rates at a 15% cost of equity and a 3-4 year EBITDA/capital target of north of 20% (basically equivalent to doing M&A post-synergies or a project once fully scaled up at 5x EBITDA). Praxair has indicated that industry pricing discipline remains weaker as competitors stretch for growth. Anecdotally, some projects in the Middle East and Asia appear to be predicated on co-product economics, with a 0% ROIC for the base ASU project. For the six months ended 30 June 2012, Praxair, Inc. (NYSE:PX) revenues increased 2% to $5.65B. Net income increased 3% to $848M. Revenues reflect North America segment increase of 4% to $2.79B, Europe segment increase of 6% to $759M, Asia segment increase of 3% to $682M. Net income benefited from North America segment income increase of 13% to $724M, Asia segment income increase of 8% to $125M, Surface Technologies segment income increase of 2% to $53M.
- Lorillard Inc. (NYSE:LO) is reporting Q3 earnings Wednesday before the market open. Citigroup analysts expect that Lorillard Inc. (NYSE:LO)’s net sales (excluding excise taxes) will increase 8.5% YoY, which represents a sequential acceleration relative to the 4.0% growth seen in 2Q12. Their estimate is 20 bps ahead of consensus. They are forecasting core sales (excluding excise taxes, MSA payments, tobacco buyout expenses, and FDA fees) to increase 9.1% YoY, up from the 4.1% increase in 2Q12, driven by 3.1% volume growth and a 6.0 pt contribution from price/mix. Investors will be looking for details regarding FDA substantial equivalence applications; information on the new promotional initiatives for Lorillard Inc. (NYSE:LO)’s Newport Menthol offering; an update on the value-priced Maverick brand’s volume trends; and management’s beliefs regarding cigarette pricing power, particularly for the Newport brand. For the six months ended 30 June 2012, Lorillard Inc. (NYSE:LO) revenues increased 1% to $3.26B. Net income decreased 6% to $507M. Revenues reflect Net Sales increase of 2% to $2.26B. Net income was offset by Interest expense increase of 36% to $76M (expense), Investment income decrease of 50% to $1M (income). Dividend per share increased from $2.60 to $3.10. Basic Earnings per Share excluding Extraordinary Items increased from $3.75 to $3.88.
Some of the notable companies reporting after the market close is listed below:
- ASSURANT, INC. (NYSE:AIZ)
- Ameriprise Financial, Inc. (NYSE:AMP)
- AvalonBay Communities, Inc. (NYSE:AVB)
- Crown Castle International Corp. (NYSE:CCI)
- Cliffs Natural Resources, Inc (NYSE:CLF)
- Equifax Inc. (NYSE:EFX)
- Equity Residential (NYSE:EQR)
- LSI Corporation (NYSE:LSI)
- Owens-Illinois, Inc. (NYSE:OI)
- O`Reilly Automotive Inc (NASDAQ:ORLY)
- Range Resources Corp. (NYSE:RRC)
- Symantec Corporation (NASDAQ:SYMC)
Disclosure: No position in any securities mentioned