Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the iShares PHLX SOX Semiconductor Sector Index Fund (NASD: SOXX) where we have detected an approximate $26.6 million dollar outflow — that’s a 14.1% decrease week over week (from 3,200,000 to 2,750,000). Among the largest underlying components of SOXX, in trading today Texas Instruments Inc. (NASD: TXN) is down about 0.5%, Broadcom Corp. (NASD: BRCM) is down about 0.8%, and Applied Materials, Inc. (NASD: AMAT) is lower by about 1%. For a complete list of holdings, visit the SOXX Holdings page » …read more
Source: FULL ARTICLE at Forbes Markets
Tag Archives: Applied Materials
Can Micron Hold On to Its Momentum?
By Richard Saintvilus, The Motley Fool
Filed under: Investing
Shares of memory maker Micron have been on a tear. Upon reaching $10.27 last week, the stock has essentially doubled after bottoming out at $5.16 on Oct. 24. With the stock now only percentage points away from a 52-week high, investors want assurances that Micron has enough ammo to support the recent optimism. I don’t blame them.
Micron is known for its volatility. And it certainly doesn’t help that the commodity memory industry, which has posted weak margins due to low average selling prices, or ASPs, has been shaky at best. But with names like SanDisk , Samsung and Applied Materials, there’s also been a lot of value in this sector. And Micron certainly fits in that category. So, heading into the company’s earnings results, there was a lot to prove. And Micron delivered.
Who and what is Micron today?
Unlike previous reports, Micron’s second-quarter results left very little for investors to complain about. Revenue arrived at $2.1 billion, up 3% year over year. While not exactly a strong number, when compared to the first-quarter results, it represents a 13% sequential jump. Plus it was enough to beat Street estimates of $1.92 billion.
The company’s flash memory business consists of NOR and NAND, non-volatile storage technologies that requires no power to retain data. Both work the same way, but are different in functionality. NAND, which is used in devices like MP3 players, is able to retain more storage, whereas NOR, which is used in mobile phones, is faster. Micron arguably perfected this market. But there have been plenty of struggles.
Not only has Micron lost market share to SanDisk and Samsung, but the declining PC industry and soft ASPs left investors no choice but to bail on the stock. So, the Street rejoiced that the strong performance was largely due to its flagship chips, NAND and DRAM (dynamic random access memory, the type often found in personal computers).
Is this the same management team?
Though I’ve followed this company for several years, I can’t say that I recognize this management team anymore, which is a good thing. The deficits that once aggravated investors are slowly being addressed. For instance, in the quarter, DRAM revenue surged 24% sequentially due to a 38% increase in sales volume. This is despite a 10% drop in ASPs.
Ordinarily, the soft ASP situation, while not new, would be cause for concern. But the Street didn’t expect much price movement. Plus, it seems that Micron focused more this quarter on moving PC-related DRAM, which has much lower margin. In other words, this is where the higher sales volume, while typically good, might have actually hurt.
Impressively, however, NAND revenue shot up 8%, which was offset by continued struggles in the NOR segment, which fell 14% year over year. Management, however, made up for this weakness in profitability. Gross margin arrived at 18%, a 6% improvement sequentially and 5% better year over year. This resulted to a 76% …read more
Source: FULL ARTICLE at DailyFinance
Is Intel a Cash King?
By James Royal, The Motley Fool
Filed under: Investing
As an investor, it pays to follow the cash. If you figure out how a company moves its money, you might eventually find some of that cash flowing into your pockets.
In this series, we’ll highlight four companies in an industry and compare their “cash king margins” over time, trying to determine which has the greatest likelihood of putting cash back in your pocket. After all, a company can pay dividends and buy back stock only after it’s actually received cash — not just when it books those accounting figments known as “profits.”
Today, let’s look at Intel and three of its peers.
The cash king margin
Looking at a company’s cash flow statement can help you determine whether its free cash flow backs up its reported profit. Companies that can create 10% or more free cash flow from their revenue can be powerful compounding machines for your portfolio. A sustained high cash king margin can be a good predictor of long-term stock returns.
To find the cash king margin, divide the free cash flow from the cash flow statement by sales:
Cash king margin = Free cash flow / sales
Let’s take McDonald’s as an example. In the four quarters ending in December, the restaurateur generated $6.97 billion in operating cash flow. It invested about $3.05 billion in property, plant, and equipment. To calculate free cash flow, subtract McDonald’s investment from its operating cash flow. That leaves us with $3.92 billion in free cash flow, which the company can save for future expenditures or distribute to shareholders.
Taking McDonald’s sales of $25.5 billion over the same period, we can figure that the company has a cash king margin of about 14% — a nice high number. In other words, for every dollar of sales, McDonald’s produces $0.14 in free cash.
Ideally, we’d like to see the cash king margin top 10%. The best blue chips can notch numbers greater than 20%, making them true cash dynamos. But some businesses, including many types of retailing, just can’t sustain such margins.
We’re also looking for companies that can consistently increase their margins over time, which indicates that their competitive position is improving. Erratic swings in margins could signal a deteriorating business or perhaps some financial skullduggery. You’ll have to dig deeper to discover the reason.
Four companies
Here are the cash king margins for four industry peers over a few periods.
|
Company |
Cash King Margin (TTM) |
1 Year Ago |
3 Years Ago |
5 Years Ago |
|---|---|---|---|---|
|
Intel |
14.7% |
18.9% |
18.9% |
19.9% |
|
Applied Materials |
18.7% |
19.6% |
12.0% |
20.3% |
|
Advanced Micro Devices |
(8.7%) |
2.0% |
0.1% |
(34.1%) |
|
Texas Instruments |
22.8% |
17.8% |
Make Money in Buyback Achievers the Easy Way
By Selena Maranjian, The Motley Fool
Filed under: Investing
Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you’d like to add some companies executing significant stock buybacks to your portfolio, the PowerShares Buyback Achievers could save you a lot of trouble. Instead of trying to figure out which companies will perform best, you can use this ETF to invest in lots of them simultaneously.
The basics
ETFs often sport lower expense ratios than their mutual fund cousins. The PowerShares ETF‘s expense ratio — its annual fee — is 0.71%. The fund is fairly small, so if you’re thinking of buying, beware of possibly large spreads between its bid and ask prices. Consider using a limit order if you want to buy in.
This ETF has performed well, handily topping the S&P 500 over the past three and five years. As with most investments, of course, we can’t expect outstanding performances in every quarter or year. Investors with conviction need to wait for their holdings to deliver.
Why buybackers?
Not all stock buybacks make sense. If a company is buying back its stock when it’s overvalued, it’s destroying shareholder value. But sensibly timed buybacks can benefit shareholders, reducing the total share count and thereby boosting the value of remaining shares.
More than a handful of buybacking companies had solid performances over the past year. Motorola Solutions surged 25%, as it has worked on shrinking its debt and growing its free cash flow. The stock is trading near a 52-week high, and yields about 1.7%. It operates in the field of public safety equipment and its government contracts business grew 12% in 2012. It also makes mobile computers such as its Xoom tablet and Droid Xyboard, which have proven popular in the business market. The company’s fourth-quarter report featured solid earnings gains and revenue up as well.
Norfolk Southern advanced 13%, and is also near its 52-week high. Yielding 2.7%, it’s a dominant force in the South, where much of our economic growth potential lies. Our recovering economy should boost business for railroads, which offer much more cost-effective transportation than trucks. The company is also an environmental leader, operating its trains on renewable diesel fuel and developing hybrid locomotives. It’s spending heavily on its infrastructure, and has topped performance expectations. One challenge is the decline of coal, as coal has made up a significant portion of Norfolk Southern‘s business.
Applied Materials gained 6% and yields 2.9%, which includes a recent 10% dividend hike. It’s poised to benefit from an expected uptick in semiconductor demand globally, and its growing involvement in areas such as solar power also bodes well. There are already promising signs for the semiconductor industry. With a forward P/E of 14, the stock appears appealing. Applied Materials has been named one of the most ethical companies by the folks at Ethisphere.
Other companies …read more
Source: FULL ARTICLE at DailyFinance
athenahealth CEO Jonathan Bush to Keynote Xconomy Mobile Madness 2013
By Business Wirevia The Motley Fool
Filed under: Investing
athenahealth CEO Jonathan Bush to Keynote Xconomy Mobile Madness 2013
COO Ed Park also speaking at Bloomberg Big Data Conference and Economist Innovation Forum
WATERTOWN, Mass.–(BUSINESS WIRE)– athenahealth, Inc. (NAS: ATHN) , a leading provider of cloud-based practice management, electronic health record (EHR), and care coordination services to medical groups and health systems, today announced three upcoming events at which athenahealth executives will be speaking, including CEO Jonathan Bush‘s keynote at Xconomy’s Mobile Madness 2013 event, being held on March 19 in Cambridge, Massachusetts.
Mobile Madness 2013 is Xconomy’s fifth annual Spring event convening Boston-area mobile innovators to discuss the next era of software, devices, and cloud computing. Jonathan Bush, CEO of athenahealth, will kick off the day-long event by offering his perspective on mobility in health care; he will speak to the state of mobile innovation and address mobile challenges and opportunities across clinical settings.
Also on the horizon; Ed Park, COO of athenahealth, will be speaking at the Bloomberg Big Data Conference: From Hype to Value on March 14 in Washington, D.C. The Big Data Conference will examine how companies and government can harness the power of big data to cut costs, improve productivity, provide better client services, and create new products and innovations. As part of the panel “Rethinking Risks and Opportunities in Big Data: Healthcare,” Ed will address the value of big data in health care by referencing athenahealth’s unique repository of cloud-based data, built from a network of 40,000 providers and 40 million patient records.
In addition, Ed will take part in a panel at the Economist’s Ideas Economy: Innovation Forum on March 28, in Berkeley, California, on the topic of “Intelligent Computing.” The fourth annual event will explore the fundamental technological shifts redefining business in the twenty-first century. Ed joins executives from NetApp and Applied Materials to discuss recent advancements in technology, including data analytics and cloud-based services, which have made companies like athenahealth more intelligent and agile.
Specific details on each event, in order of date, are below.
- What: Bloomberg Big Data Conference: From Hype to Value
-
…read more
Source: FULL ARTICLE at DailyFinance
Applied Materials Announces Dividend Boost
By Eric Volkman, The Motley Fool
Filed under: Investing
Applied Materials has declared a larger quarterly dividend. The company is to pay $0.10 per share of its stock on June 13 to shareholders of record as of May 23. This represents an 11% increase, or $0.01, over the previous distribution of $0.09 paid in each of the company’s preceding four quarters. Before that, the disbursement was $0.08.
Applied Materials is a habitual dividend payer and in recent times has tended to raise its dividend incrementally once per year.
The new dividend annualizes to $0.40 per share, which yields 2.9% at the company’s current stock price of $13.74.
The article Applied Materials Announces Dividend Boost originally appeared on Fool.com.
Fool contributor Eric Volkman and The Motley Fool have no position in Applied Materials. Try any of our Foolish newsletter services free for 30 days. We Fools don’t all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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Applied Materials Scores Conviction Buy List Spot From Goldman Sachs Analyst
Filed under: Technology, Earnings
Applied Materials Inc. (NASDAQ: AMAT) may be looking at a new Chief Financial Officer, but one Wall Street bulge bracket firm has no concern here whatsoever. Applied’s shares have risen with the market today. What stands out is a research call where Goldman Sachs has raised the “Buy” rating classification. Applied Materials is now being added to the widely followed and highly prized Conviction Buy List at the firm.
Today’s call was an intraday call and that often garners more interest than if it is in the myriad of the morning analyst calls which take place each day between the prior day’s close and before the stock market open. The firm is touting it is a positive that naming Bob Halliday as CFO is a real positive move for Applied Materials. It is rare to see a CFO replacement being cited as a reason for such an upgrade.
Goldman Sachs believes that Halliday will be able to continue with his goal-setting and with cost containment efforts that he had at Varian Semiconductor which ultimately helped it score a significant buyout premium by Applied. The move also comes when Applied Materials is already much closer to its 52-week highs.
When we see a call of this magnitude it is hard to not recall what we deem as perhaps the most bullish semiconductor analyst call so far in 2013. In mid-January, Credit Suisse called what it saw as an “Irresistible Cyclical Bottom in Semiconductors.” That call was actually on real chip-makers rather than on the CapEx side of the chip business but it is hard to have an explosive growth in one sector without any gains in the other. Still, shares of Applied Materials were trading at only $11.63 when that call was made.
After a 2.3% gain on Tuesday, Applied Materials shares are higher by 2.3% at $13.55 against a 52-week range of $9.95 to $13.99. The company’s market capitalization is $16.25 billion and the consensus price target on the stock is $14.38 according to Thomson Reuters.
Filed under: 24/7 Wall St. Wire, Analyst Calls, Semiconductor, Semiconductors, Technology, Technology Companies Tagged: AMAT
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Foundry, Memory Orders Lift Applied Materials
Filed under: Technology, Earnings
Applied Materials Inc. (NASDAQ: AMAT) reported fiscal first quarter 2013 results after markets closed today. For the quarter, the semiconductor equipment maker posted adjusted earnings per share (EPS) of $0.06 on revenues of $1.57 billion. In the same period a year ago, the company reported EPS of $0.18 on revenues of $2.19 billion. Fourth-quarter results compare to the Thomson Reuters consensus estimates for EPS of $0.03 and $1.55 billion in revenues.
On a GAAP basis, Applied posted EPS of $0.03.
Net sales in the company’s energy and environmental solutions fell 26% in the quarter compared to sales in the same period a year ago. The group posted an adjusted operating loss of $44 million and a GAAP operating loss of $54 million. This is the group that makes equipment for the solar industry and it has been struggling for a couple of years now.
For the second quarter, Applied expects net sales to rise 15% to 25% sequentially and forecasts adjusted EPS of $0.09 to $0.15. Based on Applied’s sales estimates, revenues should be in the range of $1.73 to $1.96 billion. The consensus estimate calls for EPS of $0.10 on revenues of $1.79 billion.
The company’s backlog increased 31% sequentially and gross margins rose to 39.8% on a non-GAAP basis. Applied’s silicon systems group saw orders rise 84% in the first quarter, primarily on the strength of orders for foundry equipment.
Applied’s shares closed at $13.77 today, and are up 2.4% in after-hours trading, at $14.10, a new 52-week high if it holds. The current 52-week range is $9.95 to $13.94. The consensus target price for the shares was around $12.90 before today’s report.
Filed under: 24/7 Wall St. Wire, Earnings, Semiconductors, Technology, Technology Companies Tagged: AMAT, AMAT earnings, Applied Materials earnings, first fiscal quarter 2013
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Applied Materials Ex-Dividend Reminder
Looking at the universe of stocks we cover at Dividend Channel, on 2/15/13, Applied Materials, Inc. (NASD: AMAT) will trade ex-dividend, for its quarterly dividend of $0.09, payable on 3/13/13. As a percentage of AMAT‘s recent stock price of $13.73, this dividend works out to approximately 0.66%, so look for shares of Applied Materials, Inc. to trade 0.66% lower ? all else being equal ? when AMAT shares open for trading on 2/15/13.
Click here to learn which 25 S.A.F.E. dividend stocks should be on your radar screen » or click here to find out which 9 other stocks going ex-dividend you should know about, at DividendChannel.com » …read more
Source: FULL ARTICLE at Forbes Markets
After Drop in 2012 Semiconductor Sales, 2013 Looks Much Brighter (ARMH, INTC, AAPL, MU, SNDK, AMAT)
Filed under: Technology, Earnings
Despite an explosion in smartphone and tablet sales in 2012, overall semiconductor sales were down for the year. The three-month average for global chip sales was $24.74 billion in December, down 3% from a revised November figure of $25.51 billion, according to the Semiconductor Industry Association. Is this a trend that will continue into 2013 or is there reason to be more positive on the industry?
Global chip sales for 2012 reached $291.6 billion, a decrease of 2.7% from $299.5 billion in 2011. Total sales for the year were slightly above the $290 billion predicted by the World Semiconductor Trade Statistics (WSTS) organization in November. WSTS forecasts the global chip market will grow by 4.5% in 2013.
ARM Holdings PLC (NASDAQ: ARMH) reported earnings that rose 19.2% year-over-year to GBP164.2 million, versus the GBP151.4 million consensus. ARM enters 2013 with a robust opportunity pipeline for licensing and a record order backlog. Market share gains in long-term growth sectors look set to continue as their partners introduce new chips based on ARM technology. While analysts have recently downgraded the stock on valuation, any significant dip in the stock price may offer investors an excellent entry point.
Intel Corp. (NASDAQ: INTC) reported adjusted earnings $0.51 per share ($0.48 per share net) and $13.5 billion in sales. Thomson Reuters had estimates of $0.45 per share and $13.53 billion in sales. For the coming quarter, Intel sees revenues of $12.7 billion, with its usual plus-or-minus $500 range on it. Thomson Reuters has the coming quarterly earnings report showing a consensus of about $12.9 billion in revenue. The company is trying to end its dependence on the personal computer market to focus on the smartphone and tablet arena. With a very nice 4.25% dividend, investors can be patient with the chip giant.
In a very competitive environment, memory chip maker Micron Technology Inc. (NASDAQ: MU) may have the ability to surprise when they report in March. Long a victim of stubbornly low and competitive pricing in the industry, memory chip prices have jumped recently and may continue higher. With a forward price-to-earnings (P/E) ratio of 15.30, analysts are expecting earnings per share to be up 193% next year, and the stock is trading for slightly over book value and under one times sales. Plus insider ownership has increased by 45% over the past six months.
Another name with a potential for a bright 2013 is SanDisk Corp. (NASDAQ: SNDK), which designs, develops and manufactures NAND flash memory storage solutions that are used in various consumer electronics products. SanDisk chips are found in the Apple Inc. (NASDAQ: AAPL) iPhone 5. Smartphone makers pay up for flash, at least compared with other types of semiconductors. At $21, the SanDisk chip is the second-most-expensive component in a 32 gigabit (GB) iPhone 5, according to research firm IHS iSuppli. Only the touchscreen display costs more. SanDisk is the biggest pure-play maker of flash memory. Two weeks ago, Rajvindra Gill, an analyst for Needham, upgraded the stock to Buy from Hold. He has a price target of $60 but sees the possibility of a $65-to-$70 stock. He points out that gross margins were 40% in the fourth quarter, compared with an expected 33%, and says, “We expect margins to improve throughout the year. And when you flow that through the model, you get a tremendous amount of earnings.” In a bullish scenario, per-share earnings could reach $5 next year, Gill says, nearly a dollar above the current consensus.
One other area to always look at when gauging the growth and health of the semiconductor industry is the actual manufacturing of the chips. Applied Materials Inc. (NASDAQ: AMAT) provides manufacturing equipment, services and software to the semiconductor, flat panel display, solar photovoltaic and related industries worldwide. Like Intel, Applied Materials is an industry leader, and also pays a solid 2.76% dividend. While analysts are only expecting $0.03 in earnings for the quarter that ended in January, revenues are expected to jump from $7.58 billion this year to $9.13 billion next year, a 20% increase. Applied Materials actually may prove to be a very solid value play.
With 2012 behind the industry and growth for 2013 expected to be close to 5%, it just makes sense for investors to look at quality names in the semiconductor sector that can benefit from improving economies and a healthier consumer climate.
Filed under: 24/7 Wall St. Wire, Analyst Calls, Semiconductor, Technology, Technology Companies Tagged: AAPL, AMAT, ARMH, INTC, MU, SNDK
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Source: FULL ARTICLE at DailyFinance