The world's largest tech firm posted its fiscal second-quarter earnings Tuesday, posting stronger than expected earnings and revenue as sales of its popular iPhone and iPad remained strong. The company also announced it was returning more of its substantial cash hoard to shareholders by increasing its dividend and expanding a cash buyback program. Unfortunately, Apple's guidance moving forward fell short of analyst expectations. The company's stock fluctuated through Tuesday's session, plunging sharply at the open before climbing back to close up slightly.
Sea World filed paperwork Monday for an initial public offering which it says could raise as much as $100 million. According to documents filed with the Securities and Exchange Commission, the company will sell 20 million shares at between $24 and $27 each, giving the company a $2.4 million valuation at the midpoint of that range. Most analysts were not exactly enthusiastic about the valuation, considering it would represent a multiple of 27 times trailing earnings, a hefty price considering the multiples its rivals' stocks trade at. Six Flags Entertainment, for example, trades at just 12.1 times earnings, and even Disney, which also has a major media empire, trades at just 19 times earnings.
General Electric announced on Friday its board of directors has decided to raise its shareholder dividend by 12 percent and pump an additional $10 billion into an ongoing share buyback plan. GE shareholders will now receive a dividend of 19 cents a share, rather than the 17 cents a share planned before the increase. The conglomerate also extended the authorization period for its share repurchasing program, which had been set to expire at the end of next year. The plan had just shy of $4.9 billion left for buyback, but will now have close to $15 billion and won't expire until the end of 2015.
Electronics retailer Best Buy saw its shares plummet more than 15 percent Friday morning after the company's board of directors extended a deadline for a buyout bid from Richard Schulze, the founder of Best Buy and former chairman. Mr. Schulze stepped down from his position atop the Best Buy board in May, then was given a December 16th deadline in late August to put together a buyout bid for the struggling retailer. The board and Schulze agreed Friday morning that a new deadline of February 28 so that Schulze and his backers can see how the company fares during the all-important holiday shopping period. Schulze already owns about 20 percent of the nation's largest brick-and-mortar electronics seller.
Green Mountain Coffee Roasters, the company that founded the single-serving coffee market, issued its fiscal fourth-quarter results after Tuesday's closing bell, sending shares up more than 24 percent in after-market trading as sales and revenue easily topped estimates. The company also raised its forecast for the current quarter and the full year, sending shares skyrocketing. Shareholders had been nervous about Green Mountain's patents for the K-Cup brewing system, which expired in September, but its latest results allayed some of those fears.
Shares of Hewlett-Packard plunged more than 11 percent on Tuesday after the company revealed it was taking an $8.8 billion charge because of “accounting improprieties” at British software firm Autonomy, which HP acquired last year for $10 billion. The charge erased the company's profit in the third quarter, and marks a major setback for a company trying to reinvent itself in the post-PC age. The company did say that the accounting errors took place before HP acquired Autonomy, which was targeted last summer by then-CEO Leo Apotheker. The acquisition was highly criticized by analysts, and Apotheker stepped down less than a month after completing the deal.
Credit Suisse cut its rating on JC Penney shares Monday, and the stock continued its free-fall from last week. As of 2 PM ET, Penney shares had lost nearly 11 percent to $18.38 a share, making it the biggest decliner on the S&P 500. Prior to the onset of third-quarter earnings season, analysts had warned investors to keep an eye on Penney's cash flow situation, which was cut roughly in half from the year-ago period to just $525 million. Investors took notice, as the stock has been steadily dropping in value since the retailer issued its 3Q numbers.
Groupon Inc issued its third-quarter results Thursday, missing the consensus estimates of economists as well as its own, sending shares to a new all-time low despite reporting a 32 percent spike in revenue from the same period a year ago. Groupon launched a much-anticipated IPO about a year ago, but the stock has struggled for the most part ever since. Initially trading at $20 a share, the stock rose to as much as $26.19 per share in its first month of trading, but has struggled to remain above the break-even point, which it hasn't seen since February. Groupon stock closed at $3.92 at the end of Thursday's session, before the earnings release, but opened Friday's session with a loss of nearly 30 percent as investors absorbed the company's disappointing third-quarter performance.
Facebook Stock Falls to All-Time Low
The world's largest social network has struggled since launching an IPO in May, and the stock reached an all-time low on Friday after several analysts lowered their price targets and warned of further trouble ahead for Facebook stock. With about an hour to go in Friday's trading session, shares of the company had slipped just over 5 percent to $18.07. That's just over 50 percent below the stock's initial offering price of $38 a share. One of the biggest problems for Facebook stock, analysts say, is that there are multiple lockup expirations, when staff and pre-IPO investors are allowed to sell their shares, but there are also major concerns about the company's ability to continue growing.
Apple Inc., which has been far-and-away the most valuable company in the world for nearly a year since surpassing Exxon Mobile in market value, achieved an even bigger milestone on Monday as its market cap surged to $619 billion, making the tech giant the most valuable company in the world ever. Previously, Microsoft had held the largest-ever market capitalization, reaching a valuation of $616.3 billion in December 1999, at the height of the dot com boom.