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This is still a strange market. Today, it was energy stocks that held back everyone. There was a 24,000,000-share block trade for ExxonMobil (XOM) that threw the entire market on its side. The energy sector was down nearly 4.5% today, and the rest of the market was sluggish.

Thanks to Varian (VAR) and St. Jude Medical (STJ), we beat the market again. The S&P 500 was down -1.00% today while the Buy List lost -0.55%. For the month, we’re down -2.65% compared to the S&P 500’s -4.12%.

After the close, Stryker (SYK) reported earnings of 40 cents a share which was a penny below forecasts. The stock is trading lower in the after-market. The good news is that the company also reiterated its outlook for 2005 and forecast 20% EPS growth in 2006 despite increased pricing pressures in the sector:

The Kalamazoo, Michigan-based company, which made the forecast on a conference call with analysts following its third-quarter earnings report, said it still expects 2005 earnings of $1.75 a share excluding one-time items. On a net basis, it forecast earnings of $1.67 a share.

Stryker said it now expects 2005 annual sales of between $4.86 billion and $4.89 billion. Previously, the company had forecast 2005 sales of $4.9 billion.

Analysts on average had expected Stryker to post a 2005 profit of $1.76 a share, excluding items, on revenue of $4.93 billion, according to Reuters Estimates.

Not on our Buy List, Yahoo (YHOO) earned 16 cents a share, two cents ahead of estimates. Intel (INTC) earned 32 cents a share, which was a penny off forecasts. That’s a really disappointing report. Intel can’t seem to catch a break. I think the Street low-balled the forecast just to get good news from Intel, but the company still missed. The Journal has more:

The world's largest maker of semiconductors continues to benefit from robust demand for personal computers. The PC market, bucking expectations and negative economic trends like rising interest rates, posted 17% growth in the third quarter, according to research firms Gartner Inc. and IDC.

"In the third quarter, we achieved all-time records in company revenue and unit shipments across all of our major product lines," said Paul Otellini, Intel president and CEO, in a prepared statement.

But Intel has struggled to meet demand for some of its products, even though its factories are running at full capacity. The company recently said it would invest $345 million to increase production at two plants.

It has also been pressured by Advanced Micro Devices Inc. (AMD), especially in the market for server chips. AMD beat its larger rival to market in April with "dual core" chips and gained some ground on Intel, which recently released new chips to close the performance gap. Last week, AMD posted a 73% jump in quarterly profit.

Posted by edelfenbein at October 18, 2005 5:02 PM