>>> US Gapping down

Gapping down

In reaction to disappointing earnings/guidance: CONN -28.3%, HAWK -14.5% (also downgraded to Underperform from Neutral at Macquarie), MM -11.1%, GDP -7%, ACHC -5.2%, (ticking lower), AEG -5.2%, PVA -4.3%, (announces year-end 2013 proved reserves and provides operational update; FY13 proved oil and gas reserves increased by 22.9 MMBOE, or 20%, to 136.3 MMBOE from 113.5 MMBOE), DENN -3.6% (light volume), YNDX -3.5%, RBCN -3.1%, DNR -2.7%, CROX -1.7%, WMT -1.7% (also raises dividend and expanding small store format), PAAS -1.6%, RGP -1.6% (light volume), ALLE -1.2%, (light volume), WMB -1.2%, SNPS -0.4% (also announces acquisition of Coverity, a provider of software quality, testing, and security tools, for $375 mln, or $350 mln net of cash).

M&A news: FB -1.9% (to acquire WhatsApp, a mobile messenger, for $16 bln).

Select solar names showing early weakness: YGE -3.8%, TSL -1.6%, JKS -1.5%, RSOL -1%, .

Other news: ONTX -35.1% (announces results from Phase 3 ONTIME Trial of Rigosertib in higher risk myelodysplastic syndromes did not meet primary endpoint; downgraded at Janney and Piper), USU -14.3% (still checking), CYTK -8.1% (announces proposed public offering of common stock; size not disclosed), KYN -5.2% (announces public offering of 6.75 mln shares of its common stock), NCQ -3.7% (intends to raise a total of ~ $20 mln through the combination of a public offering and a private placement with its large shareholders), PLUG -3.1% (still checking), ALU -2.8% (still checking; may be attributed to NOK / JNPR speculation), MUX -2.4% (McEwen Mining El Gallo 1 Mine Expansion Nears Completion), HGG -2.1% (following CONN results), TRP -1.8% (WSJ discusses that Nebraska Judge has blocked his Keystone decision), BERY -1.4% ( announces secondary public offering of 9 mln shares of common stock by funds affiliated with Apollo Global Management).

Analyst comments: PPO -1.4% (downgraded to Mkt Perform from Outperform at William Blair ), ABB -1.2% (downgraded to Sell from Neutral at Goldman), AAPL -0.8% (Apple downgraded to Equal-Weight from Overweight at Barclays)

>>> US Gapping up

Gapping up

In reaction to strong earnings/guidance: TSLA +12.1%, IMAX +9.8%, DL +9.4% (light volume), AWAY +9.4%, PRAA +8.5% (also agrees to acquire Aktiv Kapital for $880 mln, while also agreeing to assume ~$435 mln of its corporate debt, resulting in an acquisition of estimated total enterprise value of $1.3 bln; expected to be immediately accretive to earnings), AVG +7.5%, TRN+4.5%, MONT +4%, ASGN +3.9%, JACK +3.6%, VECO +3.5%, SWY +3.4%, (also following late spike on PE speculation; confirmed discussions concerning a possible transaction involving the sale of co; plans to distribute Blackhawk shares to stockholders; also exploring monetization of its ownership in Casa Ley), WLT +3.1%, EIG +2.9%, ( downgraded to Mkt Underperform from Mkt Perform at JMP Securities), ARRS +2.4%, (light volume), AMTG +2.2%, (light volume), UPL +2%, HRL +2%, (ticking higher), CSGP +1.8%, MCHX +1.8%, (light volume), TRAK +1.6% (also upgraded to Outperform from Market Perform at Wells Fargo), WLK +1.6%, (light volume), EQIX +1.2%, (also downgraded to Neutral from Overweight at Piper Jaffray), ACT +1.2%.

M&A news: JNPR +2.9% (Nokia considering acquisition of JNPR, according to reports ).

Select oil/gas related names showing strength: SNP +2.9%, DO +1.6%, COP +1.0%, BP +1%, RDS.A +0.6%, SDRL +0.6%, PBR +0.6%, CVX +0.4%.

A few biotech/pharma names are higher: MRK +1.1%, AZN +1%, BMY +1.0%, GSK +1.0%

FB/WhatsApp news lifting select tech names/peers: MEET +13.1% BBRY +4.9% TWTR +0.5%

Other news: RPTP +7.2% (Announces Clinical Results With RP103 in Huntington's Disease Phase 2/3 Trial; 18 Month Clinical Results Showed Significantly Slower Progression of Total Motor Score in RP103 Treated Patients Without Tetrabenazine), ATRS +5.5% (announces positive results from the VIBEX QuickShot pharmacokinetic study in testosterone deficient men; rapid restoration and consistent maintenance of steady testosterone blood levels achieved with once-weekly subcutaneous administration using the QuickShot auto injector), KNDI +4.1% (TSLA sympathy), VE +3.3% (Veolia Environnement higher on contract win news), GRPN +2.8% (ahead of earnings after the close), SCTY +2.6% (TSLA/Musk sympathy), OMG +1.7% (OM Group company EaglePicher Technologies receives contract from Erigo Technologies to deliver a Flexible Microgrid Energy Storage System for DoD applications), SVU +1.3% (following SWY results and news), WRB +0.6% (increases share repurchase authorization back to its previous level of 10 mln shares of common stock), ALL +0.6% (increases quarterly dividend 12% to $0.28 from $0.24 per share; launches $2.5 bln common stock repurchase program), PCLN +0.5% and CTRP +0.5% (following AWAY results), NXPI +0.4% (repurchases 5 mln shs of common stock ), KR +0.3% (following SWY results and news).

Analyst comments: BLOX +3.2% (upgraded to Buy from Neutral at Goldman), BCRX +2.8% (initiated with a Buy at Mizuho; tgt $23 ), HSTM +1.4% (upgraded to Overweight from Equal Weight at First Analysis), G +1.3% (initiated with an Overweight at Piper Jaffray), ABX +1.2% (upgraded to Outperform from Sector Perform at RBC Capital), CAT +0.3% (initiated with a Buy at Deutsche Bank)

>>> Wal-Mart beats by $0.01, reports revs in-line; U.S. Q4 comparable store sale

Wal-Mart beats by $0.01, reports revs in-line; U.S. Q4 comparable store sales of -0.4%; guides Q1/FY15 EPS below consensus; sees FY15 revs at low end prior range (74.85)
Reports Q4 (Jan) earnings of $1.60 per share, $0.01 better than the Capital IQ Consensus 
Estimate of $1.59; revenues rose 1.5% year/year to $129.71 bln vs the $129.52 bln consensus

  • WMT reports U.S. Q4 comparable store sales of -0.4% vs guidance for slightly negative WMT reports Sam's Club Q4 comparable store sales of -0.1%; guided for slightly negative to 0-2% (excluding fuel). During the 14-week period, Walmart U.S. comp traffic decreased 1.7 percent, while average ticket increased 1.3 percent. E-commerce sales positively impacted comp sales by approximately 0.3 percent for the 14-week period. In the fourth quarter period, excluding fuel,1 Sam's Club comp traffic was up 1.2 percent, while ticket was down 1.3 percent. E-commerce sales positively impacted comp sales by approximately 0.4 percent for the 14-week period.
  • Co issues downside guidance for Q1, sees EPS of 1.10-1.20 vs. $1.23 Capital IQ Consensus Estimate. WMT sees U.S. Q1 comparable store sales relatively flat and Sam's Club comparable store sales relatively flat. Co issues downside guidance for FY15, sees EPS of 5.10-5.45 vs. $5.55 Capital IQ Consensus Estimate; sees FY15 revs of low end 3-5% (~$487.2 bln) vs. $491.13 bln Capital IQ Consensus Estimate.
  • "We expect economic factors to continue to weigh on our outlook... Some of the factors affecting our consumers include reductions in government benefits, higher taxes and tighter credit. Further, we have higher group health care costs in the U.S. These concerns, combined with investments in e-commerce, will make it difficult to achieve the goal we have of growing operating income at the same or faster rate than sales. In October, we forecasted a 3 to 5 percent net sales increase for fiscal 2015. Given these factors and the ongoing headwind from currency exchange, we expect to be toward the low end of the net sales guidance. "Additionally, all guidance provided today assumes currency exchange rates remain at current levels," added Holley. "If currency rates remain where they are today, net sales would be negatively impacted by approximately $3.5 billion for fiscal 2015. During the first quarter of this year, we will begin to anniversary the increased costs we incurred last year for FCPA matters, including compliance program enhancements and the ongoing investigations. We anticipate expenses for FCPA matters and compliance-related enhancements to range between $200 and $240 million for fiscal 2015." The company's pending sale of the Vips restaurant business in Mexico remains subject to regulatory approval and is now expected to be completed in the first quarter of fiscal 2015. The Vips results are recorded in discontinued operations, and the estimated future gain from the sale is expected to be approximately $0.06 per share.

>>> US Early premarket gappers

Early premarket gappers

Gapping up: TSLA +9.9%, DL +9.4%, PRAA +8.3%, AWAY +7.5%, AVG +7.5%, BBRY +6.5%, TRN +4.5%, KNDI +4.1%, ASGN +3.9%, JACK +3.6%, VECO +3.5%, SWY +3.4%, VE +3.3%, EIG +2.9%, SCTY +2.7%, ARRS +2.4%, AMTG +2.2%, CSGP +1.8%, MCHX +1.8%, OMG +1.7%, SVU +1.3%, EQIX +1.2%, BP +1%, NOK +0.7%, WRB +0.6%, ALL +0.6%

Gapping down: ONTX -35.1%, HAWK -13.3%, MM -11.1%, CYTK -8.1%, KYN -5.2%, ACHC -5.2%, GDP -5.2%, AEG -5.2%, OIBR -5.1%, PVA -4.3%, NCQ -3.7%, DENN -3.6%, RBCN -3.1%, GFI -2.8%, FB -1.9%, TRP -1.8%, RGP -1.6%, ALLE -1.2%, WMB -1.2%, RIO -1%

>>> Newmont Mining declares quarterly dividend of $0.15 per share vs $0.20 in pr

Newmont Mining declares quarterly dividend of $0.15 per share vs $0.20 in prior quarter; updates gold price-lined dividend policy to preserve financial flexibility 

Co announced its Board of Directors declared a quarterly dividend of $0.15 per share of common stock, payable on March 27, 2014, to holders of record at the close of business on March 13, 2014. The first quarter 2014 dividend is based on Newmont's gold price-linked policy and based on the average London P.M. Fix of $1,276 per ounce for the fourth quarter 2013.

Moving forward, Newmont continues to remain bullish on the long-term outlook for gold and will retain the dividend policy's link to the gold price. However, the Company will be adjusting the annual payout levels to provide financial flexibility in the current gold price environment while still offering investors continued leverage as prices rise.
Newmont's updated gold price-linked dividend policy includes a quarterly payable dividend based on the average London P.M. Fix for the preceding quarter. The first payout level will begin between $1,200 and $1,299 per ounce, with an annual dividend of $0.10 per share or $0.025 per quarter. The second payout will be between $1,300 and $1,399 per ounce, with an annual dividend of $0.20 per share or $0.05 per quarter. For each $100 per ounce additional increase in the average realized gold price above $1,300 per ounce, the annual payout will increase at a rate of $0.20 per share or $0.05 per quarter. For example, if the average London P.M. Fix for the preceding quarter was $1,400 per ounce, the annual dividend would be $0.40 per share or $0.10 per quarter.

>>> Tesla Motors beats by $0.12; guides FY14 deliveries above consensus

--> TSLA +12.6% in After hours - (1,390,181 shares traded @ 217.7906)...

Tesla Motors beats by $0.12; guides FY14 deliveries above consensus

Reports Q4 (Dec) earnings of $0.33 per share, excluding non-recurring items, $0.12 better than the Capital IQ Consensus Estimate of $0.21; non-GAAP rev (including deferred rev from lease accounting) rose 148.5% year/year to $761.3 mln vs the $673.14 mln consensus -- GAAP rev was $615 mln; Q4 deliveries 6892 -- co raised guidance to almost 6900 from slightly under 6000 on January 14.

Guidance:

"We expect to deliver over 35,000 Model S vehicles in 2014" vs. expectations of ~29K, representing a 55+% increase over 2013. Production is expected to increase from 600 cars/week presently to about 1,000 cars/week by end of the year as we expand our factory capacity and address supplier bottlenecks. Battery cell supply will continue to constrain our production in the first half of the year, but will improve significantly in the second half of 2014.

First quarter production is expected to be about 7,400 vehicles, which is significantly higher than the prior quarter production of 6,587 cars. However, as the number of cars in transit to Europe and Asia must grow substantially to support those markets, we plan to deliver ~6,400 vehicles in Q1. Deliveries will grow dramatically in future quarters as the logistics pipeline fills.

This year, we expect automotive gross margin to increase to about 28% (non-GAAP and GAAP) in Q4 through a series of small design improvements, better supplier prices and economies of scale. Q1 gross margin should increase very slightly from Q4. For the remainder of the year, gross margin should improve at a faster pace. Operating expenses and capital expenditures will increase significantly in 2014, as we plan to invest in the long term growth of Tesla. We plan to expand production capacity for Model S and Model X, invest in our store, service and Supercharger infrastructure, complete the development of Model X and start early design work on our third generation car. In Q1, operating expenses are expected to grow roughly 15%. R&D expenses will increase as design and engineering work accelerates on Model X.

We expect to have production design Model X prototypes on the road by end of year and begin volume deliveries to customers in the spring of 2015.

Conf Call Details :
- Seeing strong demand for Model X, despite no advertising; seems likely co will be unable to supply demand in China this year
Management said licensing for selling in China is not a problem, it is more local manufacturing. The company does not expect to need a local partner in China.
- Elon Musk provides color on media coverage of fires - initially saw a 'significant' drop in demand, but sales recovered after facts came out
Musk said sales have steadily improved since customers have realized that it was more of a media driven story and that Tesla cars are safe.
- Elon Musk says he thinks Model X demand will exceed Model S demand
Musk also said it seems likely that the company would continue to see demand of 1000 units per week for the Model S.
-Co is working on solutions for charging in China (193.64 -10.06)
A call participant asked how the company planned to address the issue of charging in China where owners are potentially more likely to live in apartment buildings as opposed to houses. Musk would not elaborate on the issue but said that the company plans to talk more about it in the coming months

>>> American Railcar Industries beats by $0.14, reports revs in-line

American Railcar Industries beats by $0.14, reports revs in-line
(Icahn is holding a 55% stake in this company)
Reports Q4 (Dec) earnings of $1.14 per share, $0.14 better than the Capital IQ Consensus Estimate of $1.00; revenues fell 5.1% year/year to $197.2 mln vs the $196.86 mln consensus. The decrease in consolidated revenues was due to a decrease in direct sale railcar shipments in the fourth quarter of 2013 compared to the fourth quarter of 2012, as a result of building more railcars for our lease fleet. This was partially offset by increased revenues for the railcar services and railcar leasing segments.

Segments
Total manufacturing - segment revenues for the fourth quarter of 2013 were $252.5 million, an increase of 7% over the $236.5 million for the same period in 2012.
  • The primary reason for the increase was a higher mix of tank railcars sold, which generally sell at higher prices due to more material and labor content, and at higher margins than covered hopper railcars.
Total leasing - segment revenues for the fourth quarter of 2013 were $9.5 million, an increase of 86% over the $5.1 million for the same period in 2012.
  • The primary reason for the increase in revenue was an increase in the number of railcars on lease and an increase in the average lease rate. ARI had approximately 4,450 railcars in the Company's lease fleet at the end of 2013, compared to approximately 2,590 railcars at the end of 2012.
Backlog
  • ARI's backlog as of December 31, 2013 was approximately 8,560 railcars, with an estimated market value of $1,040.1 million.
  • This backlog includes approximately 2,330 railcars for lease with an estimated market value of $326.7 million.

>>> Sequoia’s A Big Winner In Facebook’s WhatsApp Acquisition, With Its Stake Wo


Sequoia’s A Big Winner In Facebook’s WhatsApp Acquisition, With Its Stake Worth About $3 Billion

Facebook today announced its $19 billion acquisition of WhatsApp. Obviously WhatsApp has a lot to cheer about, having grown to 450 million active users over the course of the last five years. But from a pure venture perspective, the purchase represents another huge win for Sequoia Capital and partner Jim Goetz.
(UPDATE: After talking with more sources, we’re able to provide more context around WhatsApp’s funding history and Sequoia’s involvement.)
While the only funding that WhatsApp had publicized was the $8 million Series A led by Sequoia, the company had raised two subsequent rounds of financing, including an unreported $50 million Series C round. Sequoia led both of those subsequent rounds, investing about $60 million in WhatsApp over the years, which added up to a total ownership stake in the high teens, I’ve been told.
The deal is the largest acquisition of a venture-backed company in history, which also clearly puts it in the early lead for the biggest single venture return this year.
In a blog post today, Goetz said it’s been a privilege to work with the WhatsApp founders. “It’s been a remarkable journey, and we could not be happier for these talented underdogs whose unshakeable beliefs and maverick natures epitomize the spirit of Silicon Valley.”
Of course, WhatsApp isn’t the first company Sequoia had invested in before being acquired by Facebook — it led a $50 million round of financing in Instagram just days before the photo-sharing app was acquired. But it’s by far the biggest.
Assuming Sequoia owns almost 20 percent of WhatsApp, its stake is now worth about $3 billion in cash and stock. The deal by itself could provide more than a 2x return on the $1.3 billion fund the initial WhatsApp investment came from, and represents a 50x return on its investment in the company.
In an interview a few hours after the deal was announced, Goetz highlighted the international appeal of the app. While it’s not as well known in Silicon Valley circles, the app has huge engagement with users around the world.
“If you were in Spain of Brazil, most of the population there is interacting with WhatsApp multiple times a day,” Goetz said. Saying that he expected the app to become a household name in the U.S., Goetz pointed out that it has nearly half a billion users, and “is likely to touch a billion or more in the not-too-distant future.”
With that user growth also comes engagement, which Goetz believes is the highest amount in the ecosystem. And the fact that WhatsApp makes money — and has for years. “When we invested in the Series A, they had already paid income taxes, which is rare for a company at that stage,” he said.
It’s a huge deal for Sequoia, and in a strange way the WhatsApp acquisition might even be considered the firm’s revenge on Facebook for a prank Facebook CEO Mark Zuckerberg famously pulled on the partnership. Once upon a time, he pitched Wirehogwhile in his pajamas, reportedly out of spite for Sequoia partner Michael Moritz’s treatment of Sean Parker at Plaxo.
Big surprise, Sequoia never invested in Facebook.
But it seems to have made a ton of money off the social networking giant after all.