Stock Futures Little Change ahead of Data. Stocks to Watch: AAPL, ARUN, ADSK, BEBE, EAT, FB, MRK, CRM
Published on Friday, 24 August 2012 07:35 Written by Christopher Lynn
New York, August 24th (TradersHuddle.com) – Stock futures were little change amid overseas weakness, following Wall Street’s lead, after hopes that the Fed will provide another round of stimulus eased. The ongoing debate over the Fed coupled with Greece returning to the headlines out of Europe left participants wary of committing to the market in either direction, particularly after the gains in the recent weeks.
In Asia, stocks fell for the second day, as hopes for the Fed providing further accommodative measures eased. Participants worried over the pace of economic growth after the manufacturing data points in China and Europe signaled a weakening outlook. The Nikkei lost 1.2% amid weakness on steelmakers and other economic sensitive stocks, while the Shanghai Composite dropped 1%, closing at its lowest level in almost 3-1/2 years.
In Europe, markets were struggling amid stubborn jitters over the debt crisis in the region and after the likelihood of a swift action from the Fed to boost growth at the world’s largest economy dimmed. Investors were awaiting a meeting between German Chancellor Angela Merkel and Greek Prime Minister Antonis Samaras, as the possibility of Greece exiting the euro zone was resurfacing. Meanwhile, U.K. second quarter GDP was revised to -0.5% from a prior reading of -0.7%.
The euro was falling against the Dollar, but still trading above the $1.25 level. Crude oil was losing 0.26% to $96.02 per barrel. Also in the energy complex, natural gas was gaining 0.82% to $2.825 per MMBtu. Gold was sliding 0.15% to $1668.10 an ounce, and silver was dropping 0.05% to $30.44 an ounce, meanwhile copper was retreating 0.52%.
On economic data, at 8:30 am, the Commerce Department will release figures on Durable Goods orders.
Today’s Stocks to watch: Apple (NASDAQ: AAPL), Aruba Networks (NASDAQ: ARUN), Autodesk (NASDAQ: ADSK), Bebe Stores (NASDAQ: BEBE), Brinker (NYSE: EAT), Facebook (NASDAQ: FB), Merck (NYSE: MRK), and Salesforce.com (NYSE: CRM).
Apple (NASDAQ: AAPL), the maker of iPads and iPhones, was losing 0.1% to $662 in pre-market, after losing 0.9% in the prior session. The stock has seen a rally of more than 16% since its big earnings miss in July and posted a new all-time high of $674.88 amid heightened expectations ahead of the release of the new redesigned iPhone 5 in the first part of September. This week, Needham boosted its target price to $750 from $620, while last week, Jefferies raised its target price to $800 per share. Separately, South Korea's Samsung won a home court ruling in its patent wars against Apple when judges in Seoul said the company didn't copy the look and feel of the U.S. company's iPhone, and that Apple infringed on Samsung's wireless technology. However, in a split decision on patents, the panel of judges also said Samsung violated Apple technology and ordered both sides to pay limited damages.
Aruba Networks (NASDAQ: ARUN), the computer networking company, will be in focus after surging 15% to $19.48 in after hours. The company posted earnings of $0.18 per share, $0.01 better than consensus, excluding non-recurring items, on revenue that jumped 22.3% from a year ago to $139.2 million versus consensus of $136.85 million. Mizuho raised its target price to $17 from $11, while Needham bumped its target price to $23 from $20.
Autodesk (NASDAQ: ADSK), the design software Company, will be in focus after the stock plunged more than 21% to $28.10 in after hours following negative reaction to an earnings miss and weak outlook. The company said it earned $0.48 per share, $0.01 worse than consensus, on revenue that climbed 4.2% from a year ago to $569 million versus consensus of $593.63 million. For the current quarter, Autodesk issued earnings and revenue guidance that is below consensus. The stock was downgraded to Hold from Buy at Canaccord Genuity and to Underperform from Neutral at Bank of America Merrill.
Bebe Stores (NASDAQ: BEBE), the specialty retailer, will be in focus after beating earnings expectations on revenue that was above consensus. However, the company issued earnings guidance for the current quarter that was below consensus. Bebe said it earned $0.04 per share, $0.01 better than consensus, on revenue that fell 0.6% from a year ago to $131.5 million versus consensus of $128.4 million.
Brinker (NYSE: EAT), the casual dining Company owner of Chilli's and Maggiano's Little Italy restaurant chains, will be in focus after the company announced a dividend increase and additional $500 million for share repurchases. The board approve a 25% increase in its quarterly dividend to $0.20 from $0.16, while increasing the outstanding share repurchasing authorization to $626 million.
Facebook (NASDAQ: FB), the social media Company, will be in focus after the company yesterday announced a new app for the iPhone and the iPad that will make it faster for users, while providing increased screen space for the news feed. The app will try to capitalize in the company’s new sponsored news feed, which has been generating increased clicks for advertisers. The stock has seen a new bout of selling after the first IPO lockup period expired last week, providing early investors and insiders with the opportunity to sell shares.
Merck (NYSE: MRK), the maker of Singulair and Zocor, was falling 0.5% to $42.59 in pre-market after the stock was downgraded to a Neutral rating from Buy at Bank of America Merrill.
Salesforce.com (NYSE: CRM), the provider of Internet based customer relationship management software, was tumbling 5.6% to $138.55 in pre-market after the company issued a weak third quarter earnings outlook. Salesforce posted quarterly results that topped expectations but disappointed investors by issuing mixed guidance for the quarter, while saying that it expects fiscal 2013 EPS inline with expectations and revenue above consensus. The company said it earned $0.42 per share, $0.03 better than consensus, on revenues that jumped 34.1% from a year ago to $732 million versus consensus of $728.14 million.
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