BetterTrades
(Best) PCLN, ORLY, WFMI (Worst) BMRN, SPAR, ITRI from Better Trades
February 19, 2009
As investors gradually moved back into the markets and then back out, following the massive sell-off to start the week, the major indices were trading in the green heading into the noon hour, before turning lower by the close.
Unable to shrug off dire economic reports, the markets were all lower, by at least 0.5%, as particular stocks were benefiting from positive earnings reports. However, others did not fare so well, as the markets helped propel the weakened stocks lower.
Top 3 Stocks
PCLN – Priceline.com Inc.
Having pioneered a unique e-commerce pricing system known as a “demand collection system”, Priceline.com Inc. (PCLN) enables consumers to use the Internet to save money on a wide range of products and services while enabling sellers to generate incremental revenue. Throughout the day, Priceline saw their stock jump in trading following a better-than-expected earnings report late Wednesday.
In their report, PCLN acknowledged that their 4Q profits were $33.3M, or $0.73 per share, compared to last year’s earnings of $32.9M, or $0.68 per share. Excluding one-time items, PCLN posted quarterly earnings of $58.2M, or $1.29 per share. Revenues, meanwhile, jumped 21% year-over-year, climbing from $334.9M to $406.1M.
Analysts, in the meantime, were looking for the online travel service provider to post quarterly results of $1.05 per share on overall sales of $377.8M. Heading into fiscal 2009, PCLN is looking to post 1Q earnings between $0.85 and $0.95 per share with revenues increasing between 5% and 10% over last year’s 1Q sales. Analysts are looking for 1Q earnings of $0.81 per share on total sales of $412.6M.
By late afternoon, shares of PCLN were up nearly 17%, adding $11.51, to trade at $80.23 per share. In the past year, PCLN has ranged between $45.15 and $144.34 per share.
ORLY – O’Reilly Automotive Inc.
As a specialty retailer and supplier of automotive aftermarket parts, tools, supplies, equipment and accessories to both ``do-it-yourself`` customers and professional mechanics or service technicians, O’Reilly Automotive Inc. (ORLY) confirmed yesterday evening that the company posted higher profits on better-than-expected revenue growth.
For the recent period, ORLY booked net income of $42.71M, or $0.32 per share, versus last year’s tally of $40.6M, or $0.35 per share. The reduction in EPS is related to more outstanding shares during this year’s 4Q. Meanwhile, the jump in earnings was directly related to the company’s surge in sales, which jumped 84% over last year’s totals, climbing from $604.3M to $1.12B.
Without taking into account a $9.6M charge, ORLY would have posted net earnings of $50.3M, or $0.37 per share, well above analysts’ prediction of $0.30 per share on total sales of $1.05B. As for the upcoming 1Q, ORLY is looking to post earnings between $0.36 and $0.40 per share, with analysts expecting $0.40 per share.
For all of 2009, O’Reilly is anticipating yearly earnings between $1.83 and $1.87 per share, while analysts are projecting $1.79 per share for 2009. Heading into the final hour of trading, shares of ORLY were up nearly 14%, adding $3.76, to trade at $31.49 per share. During today’s session, shares of ORLY reached a new 52-week high of $32.23 before retreating.
WFMI – Whole Foods Market Inc.
Lastly, the largest purveyor of natural foods in the world, Whole Foods Market Inc. (WFMI), owns and operates the country's largest chain of natural food supermarkets. As a combination of a grocery store, deli, bakery, and farmer’s market, Whole Foods watched as their stock surged during Thursday’s session, following a less-than-stellar earnings report last night.
Although coming in ahead of market predictions, WFMI posted a decline in 1Q profits of $27.8M, or $0.20 per share, down nearly 29% from last year’s profit of $39.1M, or $0.28 per share. The quarter, however, did include an $11M, or $0.05 charge related to acquisition costs. Quarterly sales advanced marginally, increasing from $2.46B to $2.47B.
With consumer spending down and the country deep in a recession, Whole Foods revised their yearly projections downward today. Previously citing yearly earnings between $0.95 and $1.00 per share, WFMI reduced their outlook to a range of $0.71 to $0.76 per share on overall revenues of $8.3B. Conversely, analysts are looking for yearly earnings of $0.66 per share on total sales of $8.71B.
By late afternoon, shares of Whole Foods were up nearly 35%, adding $3.24, to trade at $12.52 per share. Since this time last year, shares of WFMI have traded in a range between $7.04 and $38.68 per share.
Worst 3 Stocks
BMRN – BioMarin Pharmaceutical Inc.
On the other hand, other stocks were battered by the markets indecision during today’s trading session along with posting sub-par quarterly results. Leading the way in percentage losses today was BioMarin Pharmaceutical Inc. (BMRN), which despite posting an increase in 4Q profits, saw their stock plummet on a disappointing forecast for 2009.
As a developer of carbohydrate enzyme therapies for debilitating, life-threatening, chronic genetic disorders and other diseases and conditions BioMarin booked a quarterly profit of $24.5M, or $0.21 per share, in contrast to the previous year’s earnings of $2.1M, or $0.03 per share. Overall revenues for the period surged as well, increasing from $44.9M to $99.3M, more than double last year’s sales.
Sales were bolstered by the company’s top two selling drugs, Kuvan, which saw revenues increase to $46.7M from $400,000 a year ago, and Naglazyme, which jumped 43% to $36.5M in sales. In the meantime, analysts were looking for the drug company to post earnings of $0.26 per share on overall sales of $106.1M.
Looking forward, BMRN is looking to post yearly sales between $300M and $329M, with analysts predicting annual sales of $368.8M. BioMarin stated that they believe that the company may post a loss in profits for 2009 of up to $15M, which in turn, pushed the shares lower during today’s session.
Advancing towards the conclusion of Thursday’s session, shares of BMRN were down nearly 30%, losing $5.20, to trade at $12.49 per share. Today’s trading saw the company’s stock break through the yearly low, and establish a new 52-week low of $11.98. Its high for the year is $40.10.
SPAR - Spartan Motors Inc.
Another beaten stock during the trading session today was Spartan Motors Inc. (SPAR), which is a leading designer, engineer and manufacturer of custom heavy-duty chassis. Before the markets opened on Thursday, the company made it known that 4Q profits were reduced due to worsening market and economic conditions
.For the quarter, Spartan booked a profit of $2.8M, or $0.09 per share, in sharp contrast to last year’s earnings of $8.2M, or $0.25 per share, a decrease in net income of nearly 66%. Sales for the period were also down, falling from $237.6M to $146.3M, a decline in overall revenues year-over-year of more than 38%.
Analysts, on average, were looking for the chassis maker to record quarterly earnings of $0.14 per share on total revenues of $137.4M. Although no figures were released, Spartan warned about 2009 results coming in below 2008 numbers as slowing demand continues to dampen the company’s production numbers.
As the final hour of trading approaches, shares of SPAR were down more than 17% in the afternoon session, falling $0.62 to trade at $2.95 per share. During the earlier part of the day, shares of Spartan hit a new seven-year low, trading at $1.31 per share. During the past year, its shares have only reached as high as $9.98 per share.
>ITRI – Itron Inc.
In business to provide integrated system solutions for collecting, communicating, analyzing and managing information about energy and water usage, Itron Inc. (ITRI) announced after the closing of the markets on Wednesday that the company’s 4Q results were mixed.
Itron’s expertise in providing communications technologies and data management products for automatic meter reading and advanced data collection systems, complex billing and settlement systems for the wholesale energy markets, helped the company post quarterly earnings of $4.3M, or $0.12 per share, versus last year’s net income of $4M, or $0.12 per share. Excluding certain one-time charges, ITRI posted a net profit of $24.9M, or $0.71 per share, just below analysts’ expectations.
Revenues, meanwhile, decreased year-over-year for Itron, falling from $481M to $432M, a decline in sales of just over 10%. On average, analysts were looking for technical instrument maker to record earnings of $0.72 per share on total revenues of $442.5M.
Heading into fiscal 2009, ITRI is expecting to record yearly earnings between $3.35 and $3.75 per share on total sales in the range of $1.78B to $1.88B. Analysts are predicting annual earnings of $3.68 per share on overall revenues of $1.82B.
Shares of ITRI were trading lower heading into the close of today’s session, falling 9%, or $4.81, to trade at $48.65 per share. Within the last year, Itron has traded in a range between $34.25 and $106.25 per share.
2009 Better Trades Article
brought to you by
BRIAN MULLIN
