RIO DE JANEIRO — Brazil’s health ministry issued new figures on Wednesday about the Zika virus that offered reason for continued concern, but also a glimmer of hope.
On its own, the virus is not normally life-threatening. The most common symptoms include fever and joint pain, and most people who become infected have no symptoms at all.
The big question surrounds the virus’s link to other ailments. The health authorities in Brazil said Wednesday that reported cases of microcephaly — a rare condition in which infants are born with abnormally small heads — had climbed to 4,180 since October, a 7 percent increase from the previous tally last week.
Before the epidemic, Brazil recorded only about 150 cases of microcephaly a year.
Now, officials say they have begun investigating the cases reported by hospitals, doctors and other medical authorities around the country more closely. So far, 732 cases have been examined. In 462 of them, either no microcephaly was found, or it was caused by something other than an infection, such as alcohol or drug abuse by the mother during pregnancy, a spokeswoman for the Health Ministry said.
The spokeswoman added that congenital infections had caused 270 cases of microcephaly. But in that group, the Zika virus was found in only six infants, the ministry said.
The fact that Zika was found in only six infants with microcephaly since October does not mean that Zika is not causing the broad increase in microcephaly cases, said Dr. Artur Timerman, a leading infectious disease specialist in São Paulo.
He explained that Brazil’s ability to test effectively for Zika remained “very inefficient” because the authorities lack the most up-to-date methods. Dr. Timerman said this meant that tests used in Brazil could generally detect Zika in pregnant women or their infants only during the acute phase of the virus, which lasts about five or six days.
Dr. Timerman also said that Brazil’s number of suspected cases of microcephaly still pointed to a sharp increase.
The disease agency has cautioned that more studies are needed to confirm the connection between the Zika virus and microcephaly in infants. But it has said in a report that “the increased occurrence of microcephaly associated with cerebral damage characteristically seen in congenital infections in Zika-virus areas is suggestive of a possible relationship.”
Brazil’s federal government began requiring regional health officials to regularly report cases of microcephaly last year after a spike in cases in northeast Brazil, the same region where a Zika outbreak was crystallizing. Brazilian researchers then identified the Zika virus in the amniotic fluid of two pregnant women whose fetuses were found to have microcephaly.
Another Brazilian infectious disease specialist, Dr. Edimilson Migowski at the Federal University of Rio de Janeiro, said that he was not surprised by the relatively small number of cases in which Zika was found in babies with microcephaly.
If the mother had Zika, Dr. Migowski explained, it could still cause microcephaly in her baby, even if the virus was not later found in the infant.
“What matters is the abrupt increase in cases of microcephaly in the country in only a matter of months,” he said. “Everything indicates that Zika is behind this increase, but we’re only starting to understand how this happens.”
Baker Hughes misses by $0.11, misses on revs
- Reports Q4 (Dec) loss of $0.21 per share, $0.11 worse than the Capital IQ Consensus of ($0.10); revenues fell 48.8% year/year to $3.4 mln vs the $3.49 bln Capital IQ Consensus.
- Adjusted EBITDA for 4Q15 was $376 mln, a decrease of $146 mln or 28% sequentially, and a decrease of $1.1 bln or 74% compared to4Q14.
- Free cash flow for the quarter was $436 mln. Excluding restructuring payments of $108 mln, free cash flow would have been $544 mln for the quarter.
- Co states: "Revenue for our international operations declined 5% sequentially for the quarter as seasonal year-end product sales were insufficient to offset the drop in activity. The reduction in revenue, exacerbated by an unfavorable geographical and product mix in the eastern hemisphere, resulted in a contraction of our international margins. In North America, revenue declined 17% compared to the prior quarter, driven not only by activity and price, but also by onshore pressure pumping share losses as we strive to maintain cash flow positive operations despite continuing deteriorating market conditions. Even with the steep revenue drop, margins in this geographic segment remained flat as a result of cost-saving measures...Looking ahead, we are forecasting rig activity worldwide to continue to decline throughout 2016. At current commodity prices, the global rig count could decline as much as 30% in 2016, as our customers' challenges of maximizing production, lowering their overall costs, and protecting cash flows are now more acute..
eBay: Color on Qtr
- Wedbush maintains Neutral rating and lowers tgt to $24 from $27 on lower estimates. Firm believes eBay will continue to grow revenue mid-single digits over the next few quarters balancing a challenging competitive environment with improving ancillary businesses. Q4 revenue of $2.32 billion represented YoY FXN growth of 5% and was in line with consensus. Non- GAAP EPS of $0.50 was also in line with guidance. GMV grew 5% YoY FXN with slight sequential improvement in the US helping to offset decelerating International FXN growth.
- Needham Research notes eBay reported in-line 4Q15 results, but 2016 guidance was below expectations. Continued headwinds related to SEO, the launch of its new mobile app, and sluggish C2C business, limited marketplaces GMV and revenue growth to 4% and 1%, respectively. Firm expects eBay to continue implementing its strategic initiatives, but these headwinds and FX headwinds are likely to persist. Therefore, firm estimate flat y/y revenue in 2016 and flat EPS as improvements in operational leverage and lower share count (due to repurchases) are offset by the FX headwinds and separation related costs.
- Mizuho Securities notes eBay reported an in-line 4Q, but the guide came in below expectations. The company continues to execute on its structured data initiative, but it will take time before the changes have a real positive impact on traffic and conversion. Furthermore, firm is increasingly worried about the Macro environment, which had a negative impact on eBay's Marketplace biz a few years ago. Reiterate Neutral rating and remain on the sidelines as it does not see any near-term catalyst for the stock.
- RBC Capital notes, against low expectations, EBAY posted an in-line and lower Q4, with both Revenue and EPS in-line with Street. The company lowered guidance, largely FX related but fundamental trends were incrementally negative sending the stock materially lower after-hours. eBay also repo'd $550MM of stock. Lowers tgt to $29 from $30.
Shares of EBAY are down approx 17% in pre-market trade, hitting its lowest level since early February of 2015.
Mead Johnson Nutrition beats by $0.05, reports revs in-line; guides FY15 EPS above consensus, revs in-line
- Reports Q4 (Dec) earnings of $0.78 per share, $0.05 better than the Capital IQ Consensus of $0.73; revenues fell 11.6% year/year to $967 mln vs the $974.46 mln Capital IQ Consensus.
- Co issues guidance for FY15, sees EPS of $3.48-3.60 vs. $3.40 Capital IQ Consensus Estimate; sees FY15 revs of $4.071-4.15 vs. $4.09 bln Capital IQ Consensus Estimate.
- Co repurchased 10.7 mln shares of stock during qtr under an accelerated share repurchase agreement.
--> CAT +4.25% pre open - 35k traded
Caterpillar beats by $0.05, misses on revs; guides FY16 EPS above consensus, revs in-line
- Reports Q4 (Dec) earnings of $0.74 per share, excluding non-recurring items, $0.05 better than the Capital IQ Consensus of $0.69; revenues fell 22.6% year/year to $11.03 bln vs the $11.42 bln Capital IQ Consensus.
- Co issues guidance for FY16, sees EPS of $4.00 vs. $3.53 Capital IQ Consensus Estimate; sees FY16 revs of $40-44 bln vs. $43.48 bln Capital IQ Consensus Estimate.
- The outlook for 2016 sales and revenues does not anticipate improvement in world economic growth or commodity prices
- Sales in Construction Industries are expected to decline about 5-10% from 2015; Sales in Energy & Transportation are expected to decline about 10-15 percent from 2015; Sales in Resource Industries are expected to be down about 15-20 percent from 2015
- The 23% decrease in revenue was primarily due to lower sales volume and the unfavorable impact of currency due to continued strengthening of the U.S. dollar against most currencies, with about half of the impact from the euro
- The two most significant reasons for the decline in sales in 2015 were weakening economic growth primarily in developing countries and substantially lower commodity prices, most notably oil. While sales for both new equipment and aftermarket parts declined in all segments, most of the decrease was for new equipment
-
Sales declined in all regions
- In North America, sales decreased 26% due to lower end-user demand, primarily in Energy & Transportation, and unfavorable changes in dealer inventories, mostly in Construction Industries
- In EAME, sales declined 20% , mostly due to lower end-user demand for products used in Energy & Transportation applications and the unfavorable impact of currency, as sales in euros translated into fewer U.S. dollars
- Sales decreased 36% in Latin America, primarily due to widespread economic weakness across the region, which had a negative impact on construction and mining activity and demand for products used in oil and gas applications
- The most significant decrease was in Brazil
- Asia/Pacific sales declined 16%, primarily due to lower end-user demand for Energy & Transportation applications and products used in mining.
-
Sales decreased in all segments
- Energy & Transportation's sales declined 29% as sales decreased due to lower end-user demand and the unfavorable impact of currency. Construction Industries' sales decreased 18%, primarily due to the unfavorable impact of changes in dealer inventories as dealers decreased inventories more significantly in Q4 of 2015 compared to Q4 of 2014.
Early premarket gappers
Gapping up: NEOS +48.3%, FB +14.4%, UA +10.8%, TER +8.8%, PYPL +8.6%, MLNX +8.2%, EURN+7.2%, MT +6.6%, CAVM +4.6%, VLO +4.6%, CRUS +4.4%, , DCOM +4.4%, DLB +4%, AMZN +3.6%,AMP +3.6%, BABA +3.5%, TXN +3.4%, MTL +3.3%, LVS +2.8%, KMI +2.7%, CTXS +2.6%, ETE +2.5%,EPD +2.4%, ETP +2.3%, BHP +2.3%, NKE +2.3%, CMO +2.3%, CCI +2.2%, CNHI +2.1%, NFLX +2.1%,MCK +2.1%, BMY +2.1%, JD +2%, GPRO +1.8%, HOG +1.8%, MS +1.7%, RIO +1.7%, BBL +1.7%, SNDK+1.7%, CHKP +1.7%, KEX +1.5%, MEMP +1.5%, MEOH +1.5%, RDS.A +1.4%, F +1.3%, RDUS +1.2%,TOT +1.2%, CAFD +1.2%, DST +1.1%, MKC +0.9%, BXS +0.8%, MUR +0.8%,
Gapping down: NOW -17.7%, EBAY -13.7%, SGI -13.5%, SGI -13.5%, OSIS -12.9%, INCY -12.4%, OAS-8.8%, JNPR -8.3%, URI -7.8%, INVN -7.3%, POT -6.5%, DFS -4.1%, CLB -4%, CRR -3.3%, QCOM-2.8%, MOS -2.7%, DB -2.4%, BX -2.3%, HOLX -2.2%, NVS -1.9%, VAR -1.9%, X -1.8%, RIG -1.6%, FCX-1.5%, CS -1.5%, RBS -1.3%, GDX -1.2%, ABX -1.1%, SLV -1.1%, VRTX -1.1%, BCS -1%, CGI -0.9%,SHW -0.9%, DEO -0.8%, NOC -0.7%, NG -0.5%
Gapping down: NOW -17.7%, EBAY -13.7%, SGI -13.5%, SGI -13.5%, OSIS -12.9%, INCY -12.4%, OAS-8.8%, JNPR -8.3%, URI -7.8%, INVN -7.3%, POT -6.5%, DFS -4.1%, CLB -4%, CRR -3.3%, QCOM-2.8%, MOS -2.7%, DB -2.4%, BX -2.3%, HOLX -2.2%, NVS -1.9%, VAR -1.9%, X -1.8%, RIG -1.6%, FCX-1.5%, CS -1.5%, RBS -1.3%, GDX -1.2%, ABX -1.1%, SLV -1.1%, VRTX -1.1%, BCS -1%, CGI -0.9%,SHW -0.9%, DEO -0.8%, NOC -0.7%, NG -0.5%
Abbott Labs beats by $0.01, misses on revs; guides Q1 EPS below consensus; guides FY16 EPS below consensus
- 7Reports Q4 (Dec) earnings of $0.62 per share, $0.01 better than the Capital IQ Consensus of $0.61; revenues fell 3.1% year/year to $5.19 bln vs the $5.25 bln Capital IQ Consensus.
- Co issues downside guidance for Q1, sees EPS of $0.38-0.40 vs. $0.48 Capital IQ Consensus Estimate.
- Co issues downside guidance for FY16, sees EPS of 2.10-2.20 vs. $2.30 Capital IQ Consensus Estimate.
- Abbott's 2016 forecast assumes a significantly lower contribution from Venezuelan operations as a result of challenging market conditions in that country. Excluding the impact of foreign exchange and Venezuela, the midpoint of Abbott's 2016 adjusted EPS guidance range would reflect strong double-digit growth.
Fairchild Semi misses by $0.03, misses on revs; updates on merger talks
Reports Q4 (Dec) earnings of $0.11 per share, $0.03 worse than the Capital IQ Consensus of $0.14; revenues fell 5.8% year/year to $317.2 mln vs the $326.99 mln Capital IQ Consensus.
- Fairchild previously disclosed that it is is currently reviewing an unsolicited proposal from China Resources Microelectronics Limited and Hua Capital Management Co.,
- The parties continue to undertake reciprocal due diligence and discuss the terms of the Consortium's proposal. The Board met on January 25, 2016 and received an update on the ongoing discussions. There can be no assurance that Fairchild's board of directors will ultimately determine that the Consortium's proposal is a Superior Proposal (as defined in the Agreement and Plan of Merger with ON Semiconductor) that the terms of a transaction will be the same as those reflected in the Consortium's proposal or that any transaction with the Consortium will be agreed to or consummated.
- Fairchild remains subject to the Agreement and Plan of Merger with ON Semiconductor, and Fairchild's board of directors has not changed its recommendation in support of that agreement, nor has Fairchild's board of directors made any recommendation with respect to the Consortium's proposal.
Given the current acquisition process, Fairchild has discontinued its practice of providing detailed forward guidance and conducting an earnings conference call to discuss its financial results.
AutoNation misses by $0.07, misses on revs
- Reports Q4 (Dec) earnings of $0.96 per share, $0.07 worse than the Capital IQ Consensus of $1.03; revenues rose 5.8% year/year to $5.34 bln vs the $5.46 bln Capital IQ Consensus.
- Co said, "In the fourth quarter, new and used vehicle margins on a combined basis declined by $217 per vehicle retailed, or 11%, as compared to the fourth quarter of 2014. As of year-end, our new vehicle inventories increased 13% on a same store basis, as compared to the prior year, driven by a 49% increase in Premium Luxury inventories. We have begun, and will continue through the first quarter, to take the necessary steps to align our costs, inventory, and pricing strategy to adjust to the current market. In 2016, we expect industry new vehicle unit sales will again exceed 17 mln."