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Dow 30 Stock Roundup: Boeing, Caterpillar, Intel, Microsoft Earnings Impress
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The index suffered declines on most days of the week, weighed down by multiple concerns. Geopolitical tensions and concerns over a spike in rates weighed on investor sentiment. This led a major plunge on Wednesday, which erased the Dow’s gains for the year. However, the index bounced back in the very next session.
Last Week’s Performance
The index gained 0.3% last Friday, led by a 8.8% rally in shares of The Procter & Gamble Company (PG - Free Report) post impressive quarterly figures. The Dow also snapped its three-week losing streak.
However, the broader markets suffered losses as weak economic data overshadowed robust corporate earnings. Concerns regarding rapidly rising interest rates and rising trade tensions continued to make investors jittery.
The index increased 0.4% over last week. Markets experienced a choppy session at the beginning of last week with technology stocks suffering heavy losses. However, the reverses were somewhat pared on Tuesday on the back of strong corporate earnings.
Stocks failed to hold on to gains mid-week after the minutes of the Fed’s September meeting showed that the central bank felt that interest rates should continue to rise till monetary policy becomes restrictive.
The DowThisWeek
The Dow slid 0.5% on Monday as worries about a deluge of earnings made investors feel shaky. Also, growing geopolitical tensions and concerns of slowing global growth coupled with a decline in shares of major banks dented investors’ confidence.
Shares of banks fell primarily because of growing worries of higher mortgage rates, which could cap loan growth. Shares of The Goldman Sachs Group, Inc. (GS - Free Report) and JPMorgan Chase & Co. (JPM - Free Report) lost 2.4% and 1.4%, respectively.
The index declined 0.5% on Tuesday after declining more than 500 points at point during the trading session. Dismal guidance from Caterpillar, Inc. (CAT - Free Report) and 3M Company (MMM - Free Report) dented investor sentiment. Shares of Caterpillar and 3M plummeted 7.6% and 4.4%, respectively.
The index plummeted 2.4% on Wednesday, erasing all of its gains for 2018. Wednesday’s decline was led by a sharp decline in tech stocks, with chipmakers offering disappointing forecasts, coupled with worries about corporate earnings and concerns over global economic growth. Weak home sales data added to the worries.
The index gained 1% on Thursday, snapping its three-day losing streak. The rebound was led by a rally in tech stocks following upbeat quarterly results from Microsoft Corporation (MSFT - Free Report) . Shares of Microsoft jumped 5.8%. Shares of Caterpillar, and The Boeing Company (BA - Free Report) gained 2.9% and 2.6%, respectively.
Components Moving the Index
3M reported third-quarter earnings of $2.58 per share, missing the Zacks Consensus Estimate of $2.70. However, earnings recorded an increase of 10.7% from the year-ago tally of $2.33.
In the third quarter, Zacks Rank #4 (Sell) 3M Company’s net sales were $8,152 million, reflecting a decline of 0.2% from the year-ago quarter. Notably, the top line missed the Zacks Consensus Estimate of $8,421 million.
3M Company has revised down its adjusted earnings guidance for 2018 from $10.20-$10.45 to $9.90-$10.00 per share. Organic sales growth guidance has been revised to about 3% from 3-4% projected earlier. (Read: 3M Company Earnings, Revenues Miss Estimates in Q3)
Caterpillar delivered adjusted earnings per share of $2.86 in third-quarter 2018, which rose 47% year over year. Earnings also surpassed the Zacks Consensus Estimate of $2.83.
Revenues improved 18% year over year to $13.5 billion in the quarter under review, surpassing the Zacks Consensus Estimate of $13.2 billion. Zacks Rank #3 (Hold) Caterpillar maintained adjusted earnings per share guidance at $11.00-$12.00 for fiscal 2018. (Read: Caterpillar Q3 Earnings Top Estimates on Robust Demand)
Boeing reported adjusted earnings of $3.58 per share for third-quarter 2018, beating the Zacks Consensus Estimate of $3.45 by 3.8%. The bottom line reflected an improvement of 36.6% from $2.62 in the year-ago quarter.
The company's third-quarter revenues amounted to $25.15 billion in the quarter, surpassing the Zacks Consensus Estimate of $23.72 billion by 6%. The top line also improved 4% year over year, driven by increased revenues from all segments, except Commercial Airplane.
Zacks Rank #2 (Buy) Boeing expects 2018 revenues in the range of $98-$100 billion compared with $97-$99 billion projected earlier. Moreover, the company expects adjusted or core earnings per share in the range of $14.90-$15.10 compared with $14.30-$4.50 anticipated earlier.
Microsoft reported first-quarter fiscal 2019 earnings of $1.14 per share, which beat the Zacks Consensus Estimate by 18 cents. The figure jumped 35.7% on a year-over-year basis.
Revenues of $29.08 billion increased 18.5% from the year-ago quarter (up 18% in constant currency or cc). Further, the figure exceeded the Zacks Consensus Estimate of $27.73 billion.
For fiscal 2019, Microsoft expects foreign exchange to negatively impact revenues by 1 point. Moreover, volatility in foreign exchange is expected to hurt cost of goods sold (COGS) and operating expense growth by almost 1 point. The stock has a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Intel Corporation (INTC - Free Report) posted third-quarter earnings of $1.40 per share, beating the Zacks Consensus Estimate of $1.15 per share. This compares to earnings of $1.01 per share a year ago.
Zacks Rank #3 Intel posted revenues of $19.16 billion for the quarter ended September 2018, surpassing the Zacks Consensus Estimate by 5.79%. This compares to year-ago revenues of $16.15 billion. (Read: Intel Q3 Earnings and Revenues Beat Estimates)
Merck & Co., Inc. (MRK - Free Report) reported third-quarter 2018 adjusted earnings of $1.19 per share, which beat the Zacks Consensus Estimate of $1.16 by 2.6%. Earnings rose 7.2% year over year. Revenues for the quarter rose 5% year over year to $10.79 billion. Sales, however, missed the Zacks Consensus Estimate of $10.87 billion.
Zacks Rank #3 Merck tightened its outlook for 2018 revenues to the range of $42.1 billion – $42.7 billion from $42.0 billion – $42.8 billion. Merck raised its adjusted earnings guidance to the range of $4.30–$4.36 from the previous guidance of $4.22–$4.30. (Read: Merck Beats on Q3 Earnings, Lags Sales, Ups EPS View)
Visa Inc. (V - Free Report) reported fourth-quarter fiscal 2018 (ended Sep 30, 2018) earnings of $1.21 per share, beating the Zacks Consensus Estimate by 0.83%. Also, the bottom line improved 34% year over year. Net operating revenues of $5.43 billion came in line with the Zacks Consensus Estimate but were up 12% year over year. Visa has a Zacks Rank #3.
The company projected annual net revenue growth of low double digits on a nominal basis, with approximately 1% of negative foreign currency impact and minimum impact from the new revenue accounting standard.
The company expects annual diluted class A common stock earnings per share growth in high teens on a GAAP nominal dollar basis and mid-teens on an adjusted, non-GAAP nominal dollar basis. (Read: Visa Q4 Earnings Beat on Increase in Payment Volumes)
Procter & Gamble reported quarterly earnings of $1.12 per share, beating the Zacks Consensus Estimate of $1.09 per share. This compares to earnings of $1.09 per share a year ago. These figures are adjusted for non-recurring items. Procter & Gamble has a Zacks Rank #3.
This quarterly report represents an earnings surprise of 2.75%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. P&G posted revenues of $16.69 billion for the quarter ended September 2018, surpassing the Zacks Consensus Estimate by 0.80%. (Read: Procter & Gamble Q1 Earnings and Revenues Beat Estimates)
Performance of the Top 10 Dow Companies
The table given below shows the price movements of the 10 largest components of the Dow, which is a price-weighted index, over the last five days and during the last six months. Over the last five trading days, the Dow has plummeted 2.2%.
Next Week’s Outlook
Third-quarter earnings have failed to lift investor sentiment during what has turned out to be a tough period for stocks. The mixed nature of these results has not helped matters. Ultimately, October is living up to its reputation for heightened volatility.
Geopolitical tensions and concerns over rising rates are unlikely to disappear in a hurry. Market watchers think that the current volatile state of the bourses will continue until November’s mid-term polls. Investors will probably have to learn to live with turbulence up to that point.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
Dow 30 Stock Roundup: Boeing, Caterpillar, Intel, Microsoft Earnings Impress
The index suffered declines on most days of the week, weighed down by multiple concerns. Geopolitical tensions and concerns over a spike in rates weighed on investor sentiment. This led a major plunge on Wednesday, which erased the Dow’s gains for the year. However, the index bounced back in the very next session.
Last Week’s Performance
The index gained 0.3% last Friday, led by a 8.8% rally in shares of The Procter & Gamble Company (PG - Free Report) post impressive quarterly figures. The Dow also snapped its three-week losing streak.
However, the broader markets suffered losses as weak economic data overshadowed robust corporate earnings. Concerns regarding rapidly rising interest rates and rising trade tensions continued to make investors jittery.
The index increased 0.4% over last week. Markets experienced a choppy session at the beginning of last week with technology stocks suffering heavy losses. However, the reverses were somewhat pared on Tuesday on the back of strong corporate earnings.
Stocks failed to hold on to gains mid-week after the minutes of the Fed’s September meeting showed that the central bank felt that interest rates should continue to rise till monetary policy becomes restrictive.
The Dow This Week
The Dow slid 0.5% on Monday as worries about a deluge of earnings made investors feel shaky. Also, growing geopolitical tensions and concerns of slowing global growth coupled with a decline in shares of major banks dented investors’ confidence.
Shares of banks fell primarily because of growing worries of higher mortgage rates, which could cap loan growth. Shares of The Goldman Sachs Group, Inc. (GS - Free Report) and JPMorgan Chase & Co. (JPM - Free Report) lost 2.4% and 1.4%, respectively.
The index declined 0.5% on Tuesday after declining more than 500 points at point during the trading session. Dismal guidance from Caterpillar, Inc. (CAT - Free Report) and 3M Company (MMM - Free Report) dented investor sentiment. Shares of Caterpillar and 3M plummeted 7.6% and 4.4%, respectively.
The index plummeted 2.4% on Wednesday, erasing all of its gains for 2018. Wednesday’s decline was led by a sharp decline in tech stocks, with chipmakers offering disappointing forecasts, coupled with worries about corporate earnings and concerns over global economic growth. Weak home sales data added to the worries.
The index gained 1% on Thursday, snapping its three-day losing streak. The rebound was led by a rally in tech stocks following upbeat quarterly results from Microsoft Corporation (MSFT - Free Report) . Shares of Microsoft jumped 5.8%. Shares of Caterpillar, and The Boeing Company (BA - Free Report) gained 2.9% and 2.6%, respectively.
Components Moving the Index
3M reported third-quarter earnings of $2.58 per share, missing the Zacks Consensus Estimate of $2.70. However, earnings recorded an increase of 10.7% from the year-ago tally of $2.33.
In the third quarter, Zacks Rank #4 (Sell) 3M Company’s net sales were $8,152 million, reflecting a decline of 0.2% from the year-ago quarter. Notably, the top line missed the Zacks Consensus Estimate of $8,421 million.
3M Company has revised down its adjusted earnings guidance for 2018 from $10.20-$10.45 to $9.90-$10.00 per share. Organic sales growth guidance has been revised to about 3% from 3-4% projected earlier. (Read: 3M Company Earnings, Revenues Miss Estimates in Q3)
Caterpillar delivered adjusted earnings per share of $2.86 in third-quarter 2018, which rose 47% year over year. Earnings also surpassed the Zacks Consensus Estimate of $2.83.
Revenues improved 18% year over year to $13.5 billion in the quarter under review, surpassing the Zacks Consensus Estimate of $13.2 billion. Zacks Rank #3 (Hold) Caterpillar maintained adjusted earnings per share guidance at $11.00-$12.00 for fiscal 2018. (Read: Caterpillar Q3 Earnings Top Estimates on Robust Demand)
Boeing reported adjusted earnings of $3.58 per share for third-quarter 2018, beating the Zacks Consensus Estimate of $3.45 by 3.8%. The bottom line reflected an improvement of 36.6% from $2.62 in the year-ago quarter.
The company's third-quarter revenues amounted to $25.15 billion in the quarter, surpassing the Zacks Consensus Estimate of $23.72 billion by 6%. The top line also improved 4% year over year, driven by increased revenues from all segments, except Commercial Airplane.
Zacks Rank #2 (Buy) Boeing expects 2018 revenues in the range of $98-$100 billion compared with $97-$99 billion projected earlier. Moreover, the company expects adjusted or core earnings per share in the range of $14.90-$15.10 compared with $14.30-$4.50 anticipated earlier.
GAAP earnings are now projected in the range of $16.90-$17.10, up from earlier band of $16.40-$16.60. (Read: Boeing Q3 Earnings Surpass Estimates, '18 EPS View Up)
Microsoft reported first-quarter fiscal 2019 earnings of $1.14 per share, which beat the Zacks Consensus Estimate by 18 cents. The figure jumped 35.7% on a year-over-year basis.
Revenues of $29.08 billion increased 18.5% from the year-ago quarter (up 18% in constant currency or cc). Further, the figure exceeded the Zacks Consensus Estimate of $27.73 billion.
For fiscal 2019, Microsoft expects foreign exchange to negatively impact revenues by 1 point. Moreover, volatility in foreign exchange is expected to hurt cost of goods sold (COGS) and operating expense growth by almost 1 point. The stock has a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Intel Corporation (INTC - Free Report) posted third-quarter earnings of $1.40 per share, beating the Zacks Consensus Estimate of $1.15 per share. This compares to earnings of $1.01 per share a year ago.
Zacks Rank #3 Intel posted revenues of $19.16 billion for the quarter ended September 2018, surpassing the Zacks Consensus Estimate by 5.79%. This compares to year-ago revenues of $16.15 billion. (Read: Intel Q3 Earnings and Revenues Beat Estimates)
Merck & Co., Inc. (MRK - Free Report) reported third-quarter 2018 adjusted earnings of $1.19 per share, which beat the Zacks Consensus Estimate of $1.16 by 2.6%. Earnings rose 7.2% year over year. Revenues for the quarter rose 5% year over year to $10.79 billion. Sales, however, missed the Zacks Consensus Estimate of $10.87 billion.
Zacks Rank #3 Merck tightened its outlook for 2018 revenues to the range of $42.1 billion – $42.7 billion from $42.0 billion – $42.8 billion. Merck raised its adjusted earnings guidance to the range of $4.30–$4.36 from the previous guidance of $4.22–$4.30. (Read: Merck Beats on Q3 Earnings, Lags Sales, Ups EPS View)
Visa Inc. (V - Free Report) reported fourth-quarter fiscal 2018 (ended Sep 30, 2018) earnings of $1.21 per share, beating the Zacks Consensus Estimate by 0.83%. Also, the bottom line improved 34% year over year. Net operating revenues of $5.43 billion came in line with the Zacks Consensus Estimate but were up 12% year over year. Visa has a Zacks Rank #3.
The company projected annual net revenue growth of low double digits on a nominal basis, with approximately 1% of negative foreign currency impact and minimum impact from the new revenue accounting standard.
The company expects annual diluted class A common stock earnings per share growth in high teens on a GAAP nominal dollar basis and mid-teens on an adjusted, non-GAAP nominal dollar basis. (Read: Visa Q4 Earnings Beat on Increase in Payment Volumes)
Procter & Gamble reported quarterly earnings of $1.12 per share, beating the Zacks Consensus Estimate of $1.09 per share. This compares to earnings of $1.09 per share a year ago. These figures are adjusted for non-recurring items. Procter & Gamble has a Zacks Rank #3.
This quarterly report represents an earnings surprise of 2.75%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. P&G posted revenues of $16.69 billion for the quarter ended September 2018, surpassing the Zacks Consensus Estimate by 0.80%. (Read: Procter & Gamble Q1 Earnings and Revenues Beat Estimates)
Performance of the Top 10 Dow Companies
The table given below shows the price movements of the 10 largest components of the Dow, which is a price-weighted index, over the last five days and during the last six months. Over the last five trading days, the Dow has plummeted 2.2%.
Next Week’s Outlook
Third-quarter earnings have failed to lift investor sentiment during what has turned out to be a tough period for stocks. The mixed nature of these results has not helped matters. Ultimately, October is living up to its reputation for heightened volatility.
Geopolitical tensions and concerns over rising rates are unlikely to disappear in a hurry. Market watchers think that the current volatile state of the bourses will continue until November’s mid-term polls. Investors will probably have to learn to live with turbulence up to that point.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>