Thursday, 28 January 2010 21:58
Abbott Labs: Quarterly earnings topped expectations on an 11% rise in sales, led by medical producsts which grew 23.5%. The company boosted its guidance for 2010 to between $4.20 $4.25 per share, ahead of the $4.17 consensus and good for 13.5% earnings growth. ABT shares are cheap at only 12-13 times '10 earnings.
United Technologies: UTX beat on both the top and bottom line for the fourth quarter. The company noted particular strength in China and provided earnings guidance for 2010 between $4.40 to $4.65 per share. That equates to between 7% and 13% earnings growth for the year. At the midpoint of guidance, UTX shares trade for 14.88 times earnings.
Qualcomm: Despite surpassing analyst earnings expectations on a 6% rise in revenues for the quarter, QCOM shares plunged on a weaker-than-expected outlook for the 1st quarter of 2010. The company maintained its previous earnings guidance for the full year at between $2.10 to $2.30. At the low end, this implies a 19 forward PE and an 18 PE at the high end. The company has no debt and $15 billion of cash on its balance sheet - we would not be surprised to see a significant buyback announement given the swift decline in the stock price. Adoption of 3G in China and especially in India is in its infancy and Qualcomm should see a pronounced accelration of earnings as a result. Smart phones accounted for 20% of total cell phones shipped in the 4th quarter - the company projects this to grow to 40% by 2014. Further, it's Snapdragon chipset that combines mobile broadband, WiFi, Bluetooth and GPS capabilities has significant opportunities to gain market share. This is a wonderful opportunity to buy more QCOM shares on the dip.
3M: MMM delivered quarterly earnings of $1.30 per share, compared to the consensus estimate of $1.21, on an 11% rise in revenues. All divisions reported strong growth. The company boosted guidance for 2010 with earnings now expected at between $4.90 to $5.10. At the midpoint of this range, MMM shares trade at a forward PE of 16.
Colgate-Palmolive: Coglate beat the Street with earnings of $1.21, versus the $1.18 consensus. Revenues rose 11%. The company expects another year of double-digit earnings growth in 2010, implying a forward PE of only 15.
L-3 Communications: LLL reported earnings of $1.93 on a 5% increase in revenues, ahead of the $1.85 consensus. The company raised its guidance for 2010 from between $7.85 to $8.05 to a new range of $8.00 to $8.20 per share. LLL shares sell at only 10 times forward earnings.
In other news, Oracle closed its purchase of Sun Microsystems for $7.5 billion, $5.5 billion net of Sun's cash. Oracle announced it will need to hire a net 2,000 additioanl employees as a result of the acquisition.