Author Archive

  • Q2 Earnings Season at the Midway Point
    , July 28th, 2011 at 11:12 am

    Bloomberg has a summary of earnings season. Of the 500 companies in the S&P 500, 252 have reported so far.

    Breaking it down, 72.6% have beaten expectations, 11.1% came inline and 16.3% missed earnings. Earnings are tracking for $24.93 which is a 15.79% increase over the $21.53 the S&P 500 earned in the second quarter of 2010.

  • AFLAC Up 6.3%
    , July 28th, 2011 at 11:00 am

    As it turns out, what AFLAC ($AFL) had been telling us (repeatedly) for the past few months was indeed correct — the company isn’t going under. The earthquake in Japan failed to have a major impact on their business. Also, the company has gradually separated itself from the problems in Europe.

    The shares are currently up 6.3% today. I don’t see why this stock is going for less than $50. Of course, markets have been known to be irrational.

  • Deluxe Earns 75 Cents Per Share
    , July 28th, 2011 at 8:48 am

    The earnings reports are still coming in. Deluxe ($DLX) just reported adjusted quarterly earnings of 75 cents per share. Quarterly revenue dropped 0.5% to $346.3 million which was slightly better than Wall Street’s forecast. The company hed been expecting EPS to range between 66 cents and 71 cents per share. Wall Street was expecting 71 cents per share.

    For the third quarter, Deluxe expects adjusted earnings of 71 cents to 77 cents per share on revenue of $353 million to $361 million.

    Deluxe also raised their full-year outlook from $2.90 – $3.10 per share to $3.00 – $3.15 per share. Currently, Wall Street’s full-year forecast is at $3.03 per share.

    Here are some second-quarter highlights from the earnings report:

    Revenue for the quarter was $346.3 million compared to $348.0 million during the second quarter of 2010 with growth in Small Business Services partially offsetting declines in Financial Services.

    Gross margin was 65.1 percent of revenue compared to 65.0 percent in 2010. Favorable impacts from price increases and the Company’s continued cost reduction initiatives were offset by increased material costs and delivery rates.

    Selling, general and administrative (SG&A) expense decreased $3.2 million in the quarter compared to 2010. Increased SG&A expense associated with acquisitions, brand awareness campaigns, and investments in revenue generating initiatives were more than offset by benefits from continuing to execute against cost reduction initiatives.

    Operating income in 2011 was $64.0 million compared to $63.2 million in the second quarter of 2010. Restructuring and transaction-related costs were $5.0 million in 2011 versus $2.7 million in 2010. The 2011 costs were primarily attributable to the Company’s on-going cost reduction initiatives and the April Banker’s Dashboard acquisition. Operating income was 18.5 percent of revenue compared to 18.2 percent in the prior year.

    Reported diluted EPS increased $0.03 from the prior year driven by improved operating performance and a lower effective tax rate primarily from lower state taxes in 2011.

    This is a very good earnings report. The stock is going for less than eight times earnings and the current dividend yield is 4.33%.

  • Morning News: July 28, 2011
    , July 28th, 2011 at 8:07 am

    Gold Steadies as Dollar Firms, U.S. Debt Talks Eyed

    Stocks, Treasuries Slide on U.S. Debt Concern; Dollar Rallies

    House Debt-Limit Vote Sets Stage for Showdown

    Treasury to Weigh Which Bills to Pay

    Investors, Worried About Debt Talks, Look for Havens

    Japan’s Tech Firms Face Weak TV Demand, Keep Forecasts

    Sony Slashes Annual Profit Forecast After Posting Quarterly Loss

    DuPont Raises Forecast as Profit Beats Estimates

    Visa Beats Estimates as Spending Increases

    Time Warner Cable Profit Jumps 23%

    C.Suisse Sees Robust CoCo Market Despite FSB Snub

    Thomson Reuters Markets Revenue Inches Up in Q2

    Alcatel-Lucent Shares Fall On Mixed Results

    Starwood 2Q Net Climbs 15% As Revenue Measure Rises; Raises Year Forecast

    Conoco’s Empire Builder Rips It Apart

    Phil Pearlman: Juniper Networks and Cisco Systems In the Same Boat After All

    James Altucher: Mouse in the Salad

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  • AFLAC Earns $1.56 Per Share of Operating Earnings
    , July 27th, 2011 at 4:26 pm

    AFLAC ($AFL) just reported second-quarter operating earnings of $1.56 per share which is two cents more than Wall Street’s consensus. That’s a 15.6% increase over last year’s second quarter. For the first half of 2011, AFLAC has earned $3.19 per share in operating profits.

    AFLAC reiterated its full-year EPS guidance of $6.09 to $6.34. The company also gave third-quarter guidance of $1.54 to $1.60 per share.

    The best news however, is that the company expects earnings next year to rise by 2% to 5%. If you recall, in May AFLAC had said that it expected earnings to grow between 0% and 5% in 2012. It’s not a big increase but it is in the right direction.

  • General Cannabis Joins OTCQX
    , July 27th, 2011 at 3:38 pm

    Today’s best press release:

    NEW YORK, July 26, 2011 /PRNewswire/ — OTC Markets Group Inc. (OTCQX: OTCM), the company that operates the world’s largest electronic marketplace for broker-dealers to trade unlisted stocks, today announced that General Cannabis, Inc. (OTCQX: CANA), a technology-based internet marketing services company, is now trading on the OTC market’s highest tier, OTCQX®.

    (Logo: http://photos.prnewswire.com/prnh/20110118/MM31963LOGO )

    General Cannabis began trading today on the OTC market’s prestigious tier, OTCQX U.S. Investors can find current financial disclosure and Real-Time Level 2 quotes for the Company on www.otcqx.com and www.otcmarkets.com.

    “Investors prefer the quality-controlled admission process on OTCQX which identifies the segment of OTC companies focused on valuation and transparency,” said R. Cromwell Coulson, President and Chief Executive Officer of OTC Markets Group. “We are pleased to welcome General Cannabis to OTCQX.”

    The Lebrecht Group, APLC will serve as General Cannabis’ Designated Advisor for Disclosure (“DAD”) on OTCQX, responsible for providing guidance on OTCQX requirements.

    About General Cannabis, Inc.

    General Cannabis, Inc. (OTCQX: CANA) trades in the United States on OTCQX under the symbol “CANA”. General Cannabis is a rapidly growing, technology driven company that is defining the multi-billion dollar cannabis industry. The wholly owned subsidiaries of General Cannabis include WeedMaps Media, Inc., General Health Solutions, Inc., General Merchant Solutions, Inc. and US Cannabis, Inc. Each subsidiary plays a vital role in the ongoing success of General Cannabis and the industry itself.

    There shares are currently at $3. How many sell orders at $4.20 do you think there are?

  • More on NICK’s Earnings
    , July 27th, 2011 at 1:18 pm

    The press release is out on Nicholas Financial‘s ($NICK) earnings.

    Nicholas Financial, Inc. announced that for the three months ended June 30, 2011 net earnings increased 48% to $5,303,000 as compared to $3,576,000 for the three months ended June 30, 2010. Per share diluted net earnings increased 47% to $0.44 as compared to $0.30 for the three months ended June 30, 2010. Revenue increased 11% to $16,634,000 for the three months ended June 30, 2011 as compared to $14,952,000 for the three months ended June 30, 2010.

    “Our strong growth in earnings per share for the first quarter ended June 30, 2011 were favorably impacted by an increase in the average finance receivables and a reduction in the net charge-off rate,” stated Peter L. Vosotas, Chairman and CEO. “We recently opened our 57th branch location in Charleston, SC and continue to develop additional markets. The Company will also continue to evaluate new markets for future branch locations and we remain open to acquisitions should an opportunity present itself,” added Vosotas.

    I’m glad to see that Vosotas is open to an acquisition. I agree, but in my view, nothing less than $17 is worthwhile.

    This was a very good quarter for NICK. Here’s my spreadsheet with all the details. The company has nearly $270 million in receivables. Of that, their gross yield is 24.71%. Subtracting from that, interest expense was a little over $1.2 million. The borrowing rate was just 4.18% which is the lowest in the records I have.

    The key metric to watch is provision for credit losses which was just $73,000 last quarter. That’s a drop of over 95% from a year ago. NICK’s net yield came in at 22.76% which is the highest level in five years. Operating expenses were fairly low.

    Here’s a comparison to show you how profitable NICK is: Over the last year, interest expense has dropped by more than 20%. That’s over $300,000. Meanwhile, receivables are up by over $30 million. All these numbers add up to net income of $5.3 million which comes to 44.3 cents per share.

    Since NICK’s fiscal year ends in March, this was the report for their fiscal Q1. For comparison’s sake, let’s look at how their calendar is going. For NICK’s March quarter, they earned 40 cents per share. That means the company has earned 84 cents per share for the first six months of 2011.

    In the CWS Market Review from February 4th, I said that I wouldn’t be surprised if NICK earned $1.50 for the 2011 calendar year. That may have seemed wildly optimistic at the time, but now it looks pessimistic.

    All NICK has to do is keep doing what they’re doing, and earnings will have a good shot of topping $1.70 per share for this calendar year. That means the stock is going for seven times this year’s earnings based on yesterday’s closing price.

    One more thing to add: NICK’s low price from two-and-a-half years ago was $1.63 per share.

  • Nicholas Financial Earns 44 Cents Per Share
    , July 27th, 2011 at 9:14 am

    Another great quarter for Nicholas Financial ($NICK). The company pulled in 44 cents per share in the second quarter.

    July 27, 2011 – Clearwater, Florida – Nicholas Financial, Inc. (NASDAQ: NICK) announced that for the three months ended June 30, 2011 net earnings increased 48% to $5,303,000 as compared to $3,576,000 for the three months ended June 30, 2010. Per share diluted net earnings increased 47% to $0.44 as compared to $0.30 for the three months ended June 30, 2010. Revenue increased 11% to $16,634,000 for the three months ended June 30, 2011 as compared to $14,952,000 for the three months ended June 30, 2010.

    This is very good news. I’ll have more details as soon as they’re available.

  • Earnings from Fiserv and Gilead Sciences
    , July 27th, 2011 at 8:47 am

    After the closing bell yesterday, Fiserv ($FISV) reported second-quarter earnings of $1.13 per share which was five cents more than expectations. For the same quarter one year ago, the company earned $1.00 per share.

    I really like this stock. Fiserv also reiterated its full-year forecast of $4.42 to $4.54 per share. The stock is up about $1 today and is close to the all-time high price reached earlier this month.

    I was nervous about Gilead Sciences ($GILD) because it had a very bad earnings report last time. This time around, wasn’t so bad. Gilead netted $1.00 per share which was one penny better than expectations.

    Sales of Atripla, which combines Gilead’s Truvada with Bristol-Myers Squibb Co’s Sustiva into a single pill, rose 15 percent to $822 million, topping analysts’ forecasts of between $810 million and $812 million.

    Sales of Truvada rose 11 percent to $711.3 million, also exceeding Wall Street estimates of about $708 million.

    First-quarter sales of the two drugs had missed analysts’ estimates as they were hit by temporary cutbacks in state-funded AIDS drug assistance programs in Florida and Texas.

    Gilead is expected to unveil key data on its Quad HIV pill later this quarter and said it plans to file its application seeking U.S. approval in the first quarter of 2012.

    Quad, which will combine four medicines, is considered to be Gilead’s most important future growth driver by many analysts.

    The company said it is also planning to seek U.S. Food and Drug Administration approval to amend the Truvada label to include data from recent studies showing the drug can help prevent new HIV infections.

  • Morning News: July 27, 2011
    , July 27th, 2011 at 7:55 am

    Boehner Fights Internal Party Strife on Debt Plan

    On All Levels of the Economy, Concern About the Impasse

    Home Sales, Prices Reflect Malaise

    As US Debt Impasse Continues, Risks Loom In Repo Market

    Treasuries Gain as Debt-Accord Speculation Boosts Demand at Two-Year Sale

    WellPoint Tops Estimates as Expenses Fall

    Nissan 1Q Net Profit Drops 20% As Yen, Quake Offset Sales Growth

    Moody’s Downgrades Nokia Citing Weaker Market Position

    Santander Profit Tumbles On UK Charge; Delays IPOs

    Dow Profit Tops Estimates on Plastics, Chemicals

    Nasdaq OMX Profit Dips in Q2, Beats Estimates

    Dunkin’ Brands Raises $422.8 Million in IPO

    Soros to End Four-Decade Hedge-Fund Career

    Howard Lindzon: Should You Paper Trade?

    Paul Kedrosky: Hey, It’s Like Selling Stocks to Koreans

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