CACI International reported third-quarter results that were in line with consensus expectations. The company posted a 2% decline in sales during the quarter as sequestration cuts started taking effect. Additionally, the company’s growth was also negatively impacted as U.S stepped up troop withdrawal from Afghanistan. With sequestration further expected to have considerable impact on defense spending, we think this declining trend will persist in the near term. However, we also believe that the company will largely be able to make up for this as it sees increased demand for its services in the fast-growing cyberspace, health care, and integrated security…
Author: Stefan Levy
Grupo Santander , Spain’s largest bank, will absorb two subsidiaries, Banesto and Banif, and unify its presence in its home country under the Santander brand. This move is in line with the restructuring of the Spanish financial system. Grupo Santander owns 100% of Banif and 90% of Banesto. Thus, their operations and results are quite integrated already, and the Banesto payment will be neutral to Grupo Santander’s capital ratios. For the remaining 10% of Banesto shares, Santander will pay a 25% premium to the preannouncement trading price in the form of Grupo Santander shares. Naturally, we would have liked a…
Merck posted fourth-quarter sales that were in line with our expectations, but earnings came in better than expected due to cost cutting. Total sales in the quarter increased 6% organically. The Serono division increased 4%, largely driven by 7% growth in Rebif. Consumer health sales fell 7% in the quarter, but earnings increased as the firm’s new focus on profitability has led to the divestiture of unprofitable product lines. Performance materials posted impressive 17% organic growth due to strong demand out of China. However, it has come at the expense of margins as EBITDA margins in the segment fell from…
Experian turned in solid growth in its fiscal third quarter. Excluding currency effects, total revenue increased 7% year over year, with this growth spread fairly evenly across geographic segments. North America grew 7% year over year, helped by a spurt of mortgage refinancing and expansion into new verticals. Latin America recorded an 11% year-over-year increase excluding currency effects, which represents a moderation in growth but is still a good performance, given tough comps from last year and a slowing Brazilian economy. United Kingdom/ Ireland held up well, as strong growth in consumer services offset weaker results in other business lines.…
Metro reported fourth-quarter and full-year revenue slightly below consensus expectations. However, the management reaffirmed its EUR 2 billion EBIT projection for 2012. The company expects to report full-year detailed financial results March 20. That, along with the decision to pull the plug on its Media-Saturn stores in China, has shares trading higher despite the tepid fourth-quarter sales results. The move to close loss-making operations in China follows the company’s recent sale of 91 Real hypermarkets in Poland, Russia, Romania, and Ukraine. This signals that relatively new chief executive officer Olaf Koch is allocating capital more carefully. Overall fourth-quarter group sales…
Visa reported net income of $1.3 billion, or $1.92 per diluted share for the second quarter of its fiscal year on Wednesday. Operating expenses grew by 13% from the comparable year ago quarter, as the company invested in various technological initiatives. Although Visa and similar networks are now in a strong competitive position, resulting in a wide moat rating, technology is a perennial threat to their business models. Many analysts don’t think the company can afford to cut back on spending in this area. In spite of changes in pricing in response to the Dodd-Frank Act, Visa’s net revenue growth…
Chipotle Mexican Grill got off to a solid start in 2013, posting better-than-expected restaurant margins on easing food costs. Heading into the first quarter, analysts had anticipated restaurant margins of 25.4%, a 200-basis-point decline year over year due to elevated beef, dairy, and avocado costs as well as operating expense deleverage stemming from our 1% comparable-restaurant sales growth outlook. The comp target (which factored in a 2-point hit for Leap Day and Easter calendar shifts and tougher weather-related comparisons) proved accurate , but dairy and avocado costs declined faster than anticipated, resulting in restaurant-level margins of 26.3%, 90 basis points…
PRESS RELEASE (March 26, 2013) – The Glad “Stronger Stand Against Waste” won two awards – for Research Innovation and Fashion & Household Products – at last week’s ARF David Ogilvy Awards for Excellence in Advertising Research. Kelton, a leading consumer insights consultancy and part of the campaign’s research team, played an instrumental role in better understanding key drivers in the trash bag path-to-purchase for Glad’s target consumer through its innovative digital research approach. Using Kelton’s proprietary SmartCommunity platform, Clorox’s Glad benefited from online blogging and daily video confessionals, which enabled Glad to enter the home of its target consumers…
Metro AG reported detailed full-year 2012 results that continue to support the consensus belief that operating margins will reach new historical lows. The company previously released sales and confirmed its prior guidance earnings before interest and taxes (EBIT) from continuing operations of rough EUR 2 billion for 2012. However, management provided a bleak sales and profit outlook for 2013, citing weak consumer demand and further price investments. Metro also cuts its dividend from EUR 1.35 per share to EUR 1.00 per share. Full-year EBIT margins fell in 2012 from the prior year as follows: at Metro cash & carry stores…
In the fourth quarter, Spain’s Grupo BBVA barely broke even, earning EUR 19 million ($25 million). Full-year earnings came in at EUR 1.7 billion ($2.3 billion), or EUR 0.32 per share ($0.43 per ADR), yielding an ROE of 4%, half of that in 2011. 2012’s earnings were marred by government mandated real estate provisions. Even though BBVA’s 2012 core earnings (pretax, preprovision income) increased at a healthy clip, provisions for loan losses more than offset revenue growth. Spain’s banks were required to set aside extraordinary provisions against real estate assets. For BBVA, the toll was EUR 2.5 billion and with…
Agnico-Eagle Mines reported sturdy fourth-quarter results that concluded an excellent bounce-back year after the firm encountered serious challenges at its Meadowbank and Goldex mine in 2011. Analysts were impressed by the fact that Agnico actually reported a significant gold production increase in 2012 compared with 2011 despite the closure of its Goldex mine in late 2011. The firm’s 2012 achievements testify to the high caliber of Agnico’s management team, which many regard as being one of the best in the gold mining business. However, Agnico only has small incremental growth projects in its development pipeline, and some of its producing…