• NICK Earns 29 Cents a Share
    Posted by on July 29th, 2010 at 10:34 am

    Earnings just came out and they’re outstanding:

    Nicholas Financial, Inc. (Nasdaq:NICK – News) announced that for the three months ended June 30, 2010, net earnings, excluding change in fair value of interest rate swaps, increased 65% to $3,426,000 as compared to $2,081,000 for the three months ended June 30, 2009. Per share diluted net earnings, excluding change in fair value of interest rate swaps, increased 61% to $0.29 as compared to $0.18 for the three months ended June 30, 2009. See reconciliations of the Non-GAAP measures on page 2. Revenue increased 9% to $14,952,000 for the three months ended June 30, 2010 as compared to $13,694,000 for the three months ended June 30, 2009.
    According to Peter L. Vosotas, Chairman and CEO, “We are pleased to report record 1st quarter revenue and earnings. Our results were primarily impacted by an increase in revenues, a reduction in the net charge-off rate and an increase in the cost of borrowed funds. During the first quarter we have added four branch offices to our 12 state branch network, bringing the total to 54 locations. The Company continues to evaluate additional markets for future branch locations and subject to market conditions, could open additional branch locations during the year. The Company remains open to acquisitions should an opportunity present itself.”

    I knew NICK was doing well but these results are even better than what I expected. Here are the estimates I made earlier:
    Receivables: $235 million to $240 million
    Gross yield: 24% to 25%
    Interest Expense: 3% to 4%
    Provision for Credit Losses: 4%, maybe less
    Pre-Tax Yield: 9%
    And here are the results:
    Receivables: $238.3 million
    Gross yield: 25.08%
    Interest Expense: 2.58%
    Provision for Credit Losses: 2.68%
    Pre-Tax Yield: 9.43%
    A few months ago, I said that NICK could earn $1.10 a share this calendar year (the fiscal year ends in March, I used calendar year simply for market comparison).
    That must have seemed wildly optimistic but now it seems easy. NICK has made 57 cents a share for the first six months of this year. The stock’s book value is up to $8.57.
    Here’s something to think about: NICK’s net yield and pre-tax yield are the highest since Q2 of 2007. Also, the provision for credit losses is the lowest since then. The major difference is that receivables are now 28% higher and net revenues are 27% higher.
    So the stock is 27% higher, right? No! NICK was as high as $12.55 in May 2007!

  • Becton, Dickinson Kills It
    Posted by on July 29th, 2010 at 9:35 am

    Becton, Dickinson (BDX) had a great earnings report this morning. They earned $1.29 per share for the quarter which was five cents more than estimates.

    “We are pleased with our results this quarter, with each of our three segments contributing to our growth. We delivered earnings per share from continuing operations of $1.29, which is in line with the Company’s expectations,” said Edward J. Ludwig, Chairman and Chief Executive Officer. “Despite the challenging global economy, we expect to deliver bottom-line growth of approximately 9 percent foreign-currency neutral, which is in line with our previously communicated range of 8 to 10 percent for the full fiscal year 2010. Profits and cash flows continue to improve as a result of operational efficiencies. We are also pleased to announce that we are increasing our share repurchases to $700 million from $550 million, which supports our ongoing commitment to return value to shareholders.”

    They also raised full-year EPS guidance to $5.10 to $5.15. The stock is higher in this morning’s trading.

  • $837 Billion in Cash
    Posted by on July 28th, 2010 at 9:19 am

    That’s how much cash that non-financial companies in the S&P 500 are currently sitting on. That’s worth about 10% of their market value which is much higher than normal.
    The odd thing about this gigantic cash pile is that these companies are barely being paid any interest by keeping this money in cash. It shows you just how scared they are.
    Matt Krantz points out that the amount of cash is up 26% in the last year. By contrast, dividends are only up 5.9% and M&A spending is down -9.5%. If the economy can avoid a double dip, then there might be enough fuel already to power a rally.

  • What Really Moves the Markets
    Posted by on July 27th, 2010 at 7:18 pm

  • Fiserv Beats By Four Cents, Reaffirms Full-Year Guidance
    Posted by on July 27th, 2010 at 5:22 pm

    This is good news. Fiserv (FISV) made $1.00 a share last quarter. They see full-year earnings ranging between $3.96 and 4.07 per share.

  • Dividends Are In
    Posted by on July 27th, 2010 at 5:09 pm

    So far this year, 142 stocks in the S&P 500 have increased their dividends while just one stock has lowered it.
    Last year at this time, 93 stocks had raised their dividends while 61 had lowered them.
    Ten stocks have initiated dividends compared with just one at this time last year.

  • AFLAC Beat By Two Cents
    Posted by on July 27th, 2010 at 4:14 pm

    AFLAC earns $1.35.

    Operating earnings in the second quarter were $639 million, compared with $562 million in the second quarter of 2009. Operating earnings per diluted share rose 12.5% to $1.35 in the quarter, compared with $1.20 a year ago. The stronger yen/dollar exchange rate increased operating earnings per diluted share by $.02 during the second quarter. Excluding the impact from the stronger yen, operating earnings per share increased 10.8%.

    And going forward:

    “With half of the year complete, we believe we are in a very good position to meet our earnings objectives and extend our record of growth. Our objective for 2010 is to increase operating earnings per diluted share by 9% to 12%, excluding the impact of the yen. Within that range, we expect operating earnings to increase approximately 10% for the full year to $5.34 per diluted share before the impact of foreign currency. If the yen averages 90 to the dollar for the remainder of the year, we would expect full-year reported earnings to be about $5.44 per diluted share. Using that same exchange rate assumption, we expect third quarter operating earnings of $1.35 to $1.38 per diluted share. Our objective for 2011 of increasing operating earnings by 8% to 12% before the impact of foreign currency also remains unchanged.”

  • But Why?
    Posted by on July 27th, 2010 at 2:51 pm

    Ladies and gentleman, it is with deep regret that I inform you that Nassim Nicholas Taleb has blocked me from his Twitter feed.
    Therefore, I will no longer be privy to insights such as:

    Giving businessreaders my book: like giving vintage Bordeaux to drinkers of Diet Coke and listening to their comments about it

  • Credit Cards — Robin Hood In Reverse
    Posted by on July 27th, 2010 at 2:23 pm

    The Federal Reserve Bank of Boston found that credit card fees and reward programs have the net effect of transferring wealth from the poor to the rich:

    U.S. consumer finance data shows that people on a low income are less likely to have a credit card, and those who do, spend less a month on average, than higher earners. High-income consumers are also 20 percentage points more likely to receive credit card rewards — be they frequent flier miles, cash back or other enticements.
    “What most consumers do not know is that their decision to pay by credit card involves merchant fees, retail price increases, a nontrivial transfer of income from cash to card payers, and consequently a transfer from low-income to high-income consumers,” Scott Schuh, Oz Shy and Joanna Stavins wrote.
    They found that about 83 percent of banks’ revenue from credit card fees is obtained from cash payers “and disproportionately from low-income cash payers.”
    After accounting for rewards paid by banks, households who earn more than $150,000 annually receive a subsidy of $756 on average every year, while the households earning $20,000 or less pay $23.

  • Jersey Shore Rings the Opening Bell
    Posted by on July 27th, 2010 at 1:57 pm

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