Earnings Analysis: Ionis Pharmaceuticals (IONS)

Back on February 27, Ionis announced their fourth quarter and fiscal year 2017 results.  Instead of diving into results, the company started out with talking about its pipeline.  As I have been anticipating, we have some updated information on the PDUFA (and thus the retail approval) for Inotersen, which will be July 6.  At the same time, their EU review has also been accelerated and things continue to go smoothly.  With approval, Ionis will be ready for immediate launch of the drug.  They also appear to be getting close to deciding on a partner to take on the drug, which is a bit of a mix on emotion.  Giving it up means that Ionis will give up revenues, in exchange for all of the sales and marketing efforts, but given where they are in the process, the company should be able to maintain relatively high royalty rates.  Similarly, we also received an update on Volanesorsen, with the FCS therapy going in front of the FDA on May 10.  Again, the process is moving forward smoothly and Akce…

Earnings Analysis: Pepsico (PEP)

Pepsico announced their fourth quarter and fiscal 2017 year end results back on February 13.  Headline results showed a slight beat of expectations with earnings coming inline with expectations at $1.31 and sales beating expectations of $19.38B with results of $19.53B.  The company was able to return organic growth back to anticipated levels of 2.3%, most North American segments grew and took share, and the international segments saw growth of mid single digits or higher.  The down side continues to be in the North American Beverages division.  It's true that they were able to see growth quarter over quarter, which was nice to see - especially after the product placement issues last quarter.  However, the growth is still not where expected or desired with an economy in its current state.  Pepsi is now about to introduce a new fizzy water called Bubly, which they hope will help bring some life back.  Personally speaking, they brought this on much too late.  Many people wanted them …

Earnings Analysis: Apple (AAPL)

A quarter late, I'm finally writing my first review of Apple quarterly earnings.  The company reported their fiscal first quarter of 2018 on Thursday beating on top and bottom lines.  The company reported revenues of $88.3B and earnings of $3.89.  This results in a solid beat of expectations on the top line of $86.48B and a slight beat on earnings expectations of $3.86.  These results culminate in the best quarter ever for earnings and revenue for the company.  All this said, not everything was seen as great or perfect in the quarter.  IPhone sold 1% less units than that compared a year ago and mac units were down 5%.  IPad sales were up 1%.  Services grew 18% year over year.  It's worth noting that all of these numbers are built off of the fact that there was one less week this fiscal year than last.

This is the crux of where all of the chaos around this stock is based.  Essentially, it seems analysts were expecting some sort of "supercycle" because of the company se…

Trade: Home Depot

Today I removed my initial investment I made into my position of Home Depot.  The markets have gotten more volatile and turbulent and I expect this to continue as we move ahead.  The stock was up about $40 over the course of the last quarter from start to it's 52-week high just a few days ago.  I've made over 225% on my investment, so over 2/3 of my position contiues to exist.  It simply felt prudent to raise some cash and protect my gains.  The company reports in February and at these prices, I feel a perfect quarter and guidance is needed.  I feel like the stock could pull back to the 200 day moving average, at which point I could put my investment back in for awhile, if I wish.  I do have belief that the company will continue to do well in these early stages of rising rates, but I wanted to prepare for worse times, even at the risk of "selling into the panic."  I already know I didn't get my best price possible today, but my discipline has been telling me for …

Stock Analysis: Honeywell (HON)

On Friday, Honeywell announced results for fourth quarter and fiscal year 2017.  As expected, results were mostly spectacular.  Earnings came in at $1.85 on organic sales of 6%.  Revenues were $10.8B while delivering free cash flow (FCF) of 123%.  They repurchased 10.3M shares and also increased the dividend by 12% during the quarter.  These results mostly topped analyst expectations where earnings beat by a penny and revenues beat by around $90M.  Many analysts were hoping for 7% organic growth, though, which was the one bad mark for the company.  That said, the company projected only 2% - 4% organic growth, so they well exceeded their own expectations.  It is important to note that after all of these numbers, the company did report a loss of $3.8B due to provisions for U.S. Tax reform.  But these same reforms also allowed the company to adjust earnings guidance for 2018 up to $7.75 - $8.00, which is in line with my personal estimates of how reform would adjust earnings (I had conser…

Earnings Analysis: Citigroup (C)

Last week, Citigroup announced fourth quarter earnings and FY 17 results.  Overall, the quarter was solid with earnings of $1.28 and revenues of $17.25B.  This compares to estimated earnings of $1.19 and revenues of $17.22B respectively.  Something else to note is that these numbers are before what was $22B in charges related to new tax law changes.  That $22B number was two billion more than originally expected, but it seems the market was able to absorb that without too much concern.  

Looking a little deeper into the results, it was encouraging to see revenues increase across all regions, where we saw loan and deposit growth in Latin America and increases from wealth management and credit cards in Asia.  Institutional revenues were down slightly due to the continued lack of volatility in the fixed income markets.  Efficiency also improved over the quarter and despite the write down related to the Tax Act, the company is still on target to return $60B to shareholders via buybacks and…

Weekly Portfolio Summary

New year and it's time to get going on new weekly updates and a new batch of quarterly earnings reports.  Now that I've got the past year's review behind me, now it's time to start listening to fourth quarter and 2017 yearly earnings results.  We start on Tuesday when Citigroup announces their fourth quarter results.  Today, JP Morgan and Wells Fargo both reported.  There were significant tax losses and the trading divisions suffered because of low volatility.  There were also a fair amount of one-time charges,  which were expected to take advantage of tax loss benefits and other similar related events.  In general, the report was good for an institutional bank. NIM was higher and the forward outlook was postie, and with it, the bank stocks took off.  The markets will be closed on Monday for Martin Luther King Day, so Citi will be the next big bank report and I expect that we'll get another similar report and stock price results.  More specific to Citigroup, itself…