Earnings

MannKind MNKD Stock News

MannKind Corporation (NASDAQ: MNKD)

MannKind is having a rough day in the market today, and for good reason. The company reported earnings after the closing bell yesterday as expected. Unfortunately, the report missed all expectations, putting fear in the minds of investors and leading to big declines on the stock. Today, we’ll talk about what we saw from the earnings report, how investors reacted to the news, and what we can expect to see from MNKD moving forward. So, let’s get right to it…

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MNKD Misses Earnings Expectations

As mentioned above, MannKind reported its earnings for the fourth quarter following the closing bell yesterday. Unfortunately, the report was overwhelmingly negative. The company reported absolute zero in terms of revenue, while posting a wider loss than expected. In the quarter, analysts expected that MNKD would generate a loss of $0.05 per share. However, the company actually reported a loss of $0.66 per share. Not only did this widely miss analyst expectations, it shows a massive decline year over year. In the same quarter of 2014, the company reported a loss of only $0.09 per share. In a statement, Matthew Pfeffer, CEO of MNKD had the following to offer:

Our financial results for 2015 were not what we expected going into the year, but we are looking forward to the next twelve months with optimism and great excitement… Afrezza will soon be back under our control and we are all energized about the opportunity to launch a lean, focused commercial effort that highlights the differentiating qualities of our lead product.”

How The Market Reacted To The News

As investors, we know that the news moves the market. Any time we see positive news with regard to a publicly-traded company, we can expect to see gains in the value of the stock associated with that company. Adversely, when there’s negative news, we can expect to see declines. So naturally, we’re seeing declines on the value of MNKD today. The bottom line is that the overwhelmingly poor earnings report is creating a point of concern for investors, and concerned investors cause stocks to drop. Currently (11:22), MNKD is trading at $1.23 per share after a loss of $0.16 per share or 11.87% thus far today.

What We Can Expect To See Moving Forward

Moving forward, I have a relatively mixed opinion of what we can expect to see from MNKD. In the short run, chances are that the stock is going to continue on the downward path as investors continue to show their disappointment with regard to earnings. However, in the long run, I still maintain a relatively bullish opinion. My opinion on MannKind is wholly centered around the company’s lead product, Afrezza. When I first heard of Afrezza, even in trial stages, I was incredibly interested in what I was hearing. I have diabetic family members, and I can’t think of one that likes injecting themselves with insulin. Not to mention, there are many benefits to an inhaled insulin like offering it to those with a fear of needles, children, and those who work in areas without access to a public restroom. The reality is that MNKD should have no problem commercializing this treatment. While Sanofi did drag their feet and delay commercialization, they didn’t kill the chances for MNKD to be successful with this revolutionary treatment.

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Where do you think MNKD is headed and why? Let us know your opinion in the comments below!

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Valeant Pharmaceuticals VRX Stock News

Valeant Pharmaceuticals Intl Inc (NYSE: VRX)

Valeant Pharmaceuticals has been dealing with a very rough time as of late. While I would like to say the struggle is over, I don’t believe that to be the case. Don’t get me wrong, I’ve said it before and I’ll say it again, in the long run, I’m expecting to see great things out of VRX. However, I believe that tomorrow morning the company is going to hit its last hurdle before long-term growth. Today, we’ll talk about what that hurdle is, what we can expect to see in the short term, and what we can expect to see in the long-term outlook with regard to VRX.

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Valeant Pharmaceuticals Is Set To Disappoint On Earnings

VRX is expected to release its earnings report for the fourth quarter of 2015 before the market opens tomorrow. This is what I believe will be the next (and hopefully last) hurdle for VRX to get over before we can expect to see long term-growth. During the quarter, analysts have estimated that we will see $2.61 in earnings per share on revenue in the amount of $2.75 billion. If this were the case, we would see incredible year-over-year growth from in both EPS and revenue from $2.58 and $2.28 billion respectively. This would be great, but in reality, it doesn’t seem as though this is going to happen.

The truth is that in the fourth quarter, Valeant Pharmaceuticals hit a brick wall. It was in this quarter that Citron started accusing VRX of being the Enron of the pharmaceutical industry, citing their relationship with an underground pharmacy known as Philidor as the reason they have been able to manipulate investors. As a result, Valeant was forced to cancel its agreement with Philidor, their biggest customer. This undoubtedly will cost VRX a massive amount of revenue and likely cause earnings to dive! So, I’m expecting for VRX to miss earnings expectations, leading to investor fears.

What We Can Expect To See From Valeant Pharmaceuticals In The Short Term

In the short term, I have a very bearish opinion of what we can expect to see. The truth is that I think that VRX is going to dive on earnings. As investors, we know that there are few pieces of news that have the ability to move the needle in the market quite like earnings. So, with the poor earnings expectations, I’m expecting investors to react in a negative way. Therefore, tomorrow – and likely throughout the rest of the week – I’m expecting to see declines on VRX.

What We Can Expect In The Long Run

In the long run, I have an overwhelmingly bullish opinion of what we can expect to see from Valeant Pharmaceuticals. While the company has struggled as of late with regard to the Philidor issue and the fact that the CEO of the company was on medical leave for more than a month, I believe that when we talk about VRX, we’re talking about a strong company. There’s no doubt in my mind that VRX has the ability to make a comeback from the lows we’re seeing on the stock and the declines we’re likely to see tomorrow. The reality is that they are already seeing a strong recovery in prescription numbers thanks to their relationship with Walgreens. On top of that, the company has a long line of incredible products, a great management team, and perhaps most importantly, an impressive track record of success. All in all, while there is a reason to be bearish in the short run, I’m expecting to see long-term gains from Valeant Pharmaceuticals.

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What Do You Think?

Where do you think VRX is headed moving forward and why? Let us know your opinion in the comments below!

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XOMA Corp Stock News

XOMA Corp (NASDAQ: XOMA)

XOMA is having a strong day in the market today, and for good reason. The company reported its earnings for the fourth quarter of 2015 as expected yesterday after the closing bell. The earnings release was overwhelmingly positive, leading to investor excitement throughout. Today, we’ll talk about what we saw from earnings, how investors reacted to the news, and what we can expect to see from XOMA moving forward. So, let’s get right to it…

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XOMA Produces Overwhelmingly Positive Earnings

As mentioned above, XOMA is having an incredibly strong day in the market after reporting exceptional earnings after the closing bell yesterday. Here’s what we saw from the report:

  • Earnings Per Share – In terms of earnings per share, XOMA produced well ahead of expectations. In the fourth quarter analysts expected that the company would produce earnings in the amount of $0.15 per share. However, they actually reported revenue in the amount of $0.21 per share, well ahead of analyst expectations.
  • Revenue – While earnings was overwhelmingly positive, XOMA posted one of the strongest revenue beats I’ve ever seen. According to TheStreet, the company was expected to produce revenue in the amount of $4.01 million. However, in the quarter, the company actually produced revenue in the amount of $48.18 million, more than 12 times expectations!

As you can see from the data above, the earnings release was overwhelmingly positive. In a statement, the company had the following to say with regard to the incredible results from the quarter:

The increase in full-year and fourth quarter 2015 revenues was due primarily to our licensing activity in the fourth quarter, including a $37 million upfront payment from Novartis, a $5 million upfront payment from Novo Nordisk and a $3.8 million payment from Pfizer.”

The CEO of XOMA, John Varian followed up with the statement below:

The transformation we initiated in the third quarter of last year – and now have completed in less than six months – was considerable in its scale and complexity, but essential to position XOMA to deliver our promising portfolio of endocrine assets…”

How The Market Reacted To The News

As investors, we know that the news moves the market. So, it’s no surprise that news of an overwhelmingly positive earnings report from XOMA would move the needle for the stock in a big way. Currently (11:12), the stock is trading at $0.93 per share after a gain of $0.04 per share or 5.06% thus far today.

What We Can Expect To See Moving Forward

Overall, I have a relatively bullish opinion of what we can expect to see from XOMA moving forward. First and foremost, I’m incredibly impressed with the partners the company has been able to bring on board over the past few months. Bringing in some of the largest players on the biotechnology field will likely lead to incredible improvements in XOMA’s business as a whole. On top of that, I like what I’m seeing with regard to the pipeline the company currently has. At the moment, they have 3 preclinical candidates as well as one candidate in the end of Phase 1 and one candidate in the midst of Phase 2 testing. While I am a bit concerned about the company’s cash flow, I believe that the positive aspects of the stock largely outweigh anything negative there is to say.

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What Do You Think?

Where do you think XOMA is headed moving forward? Let us know your opinion in the comments below!

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Ambarella AMBA Stock News

Ambarella Inc (NASDAQ: AMBA)

Ambarella is having a rough time in the market today. The declines started in after-hours trading yesterday after the company reported earnings. While the previous quarter’s results were positive, investors seem to be concerned with guidance. Today, we’ll talk about what we saw from earnings, how AMBA is reacting to the news, and why I’m not in the least bit concerned about today’s declines. So, let’s get right to it.

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What We Saw From AMBA Earnings

As mentioned above, Ambarella reported its earnings for the fiscal fourth quarter of 2016. While earnings were overwhelmingly positive, AMBA is falling as the result of poor guidance. Here’s what we saw from the report:

  • Earnings Per Share – In the quarter, AMBA absolutely blew away expectations with regard to earnings per share. While analysts expected the company to produce earnings in the amount of $0.48 per share, the company actually reported earnings in the amount of $0.64 per share.
  • Revenue – Revenue also came in well ahead of expectations. During the fourth quarter, analysts expected the company to produce revenue in the amount $65 million, but the company actually produced revenue in the amount of $68 million.
  • Guidance – Unfortunately, weak guidance is concerning AMBA investors. AMBA expects to report revenue of $55 million to $57 million for the first quarter, below estimates of $62.44 million.

As you can see from the information above, the AMBA earnings report was relatively positive. Unfortunately however, guidance has led to fear. In a statement, Fermi Wang, CEO of Ambarella, had the following to say with regard to the results from the quarter:

During the fourth quarter we saw strong sales from professional IP security, automotive aftermarket, home monitoring and flying camera markets… This was largely offset, however, by a continued decline in the wearable sports market.”

How The Market Reacted To The News

As investors, we know that the news moves the market. Any time there is positive news with regard to a publicly-traded company, we can expect to see gains. Adversely, when negative news is released, we expect to see losses. While earnings were overwhelmingly positive, guidance was the key that led to fear. As a result, we’re currently seeing declines on the stock. Currently (10:04), AMBA is trading at $43.26 per share after a gain of $2.98 per share, or 6.44%, thus far today.

Why I’m Not Concerned About The Declines

While poor guidance has led to investor fears, and ultimately, declines in the value of AMBA, I have to say that I’m not concerned at all. In fact, I still have a relatively bullish opinion of what we can expect to see from the stock moving forward. Unfortunately at the moment, wearable camera sales are declining, and AMBA is largely looked at as a producer of chips for these cameras. However, AMBA computer chips are being used in so many other ways now. The company’s chips are being used in drones, infotainment systems, driverless car experiments, home security, and more. All in all, regardless of what happens in the wearable camera market, chances are that demand for AMBA products will climb! So, while we may see declines in the short term, I’m expecting to see long-run gains.

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What Do You Think?

Where do you think AMBA is headed moving forward? Let us know your opinion in the comments below!

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BroadSoft BSFT Stock News

BroadSoft Inc (NASDAQ: BSFT)

BroadSoft is having an incredible start to trading today, and for good reason!  Early this morning, before the opening bell, the company reported its earnings for the fourth quarter, as well as guidance for the first quarter of FY16. All in all, the company reported relatively positive numbers. Today, we’ll look at the report, how the market is reacting to the news, and what we can expect to see from BSFT moving forward. So, let’s get right to it!

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BSFT Reports Solid Earnings & Guidance

As mentioned above, BSFT reported earnings this morning absolutely blowing away expectations. Here’s what we saw from the Q4 report:

  • Earnings Per Share – In terms of earnings per share, BroadSoft did incredibly well. For the fourth quarter, analysts expected that the company would produce earnings in the amount of $0.67 per share. However, the company absolutely blew away these expectations by producing earnings in the amount of $1.04 per share.
  • Top-Line Revenue – In terms of top-line revenue, we also saw incredibly strong numbers. For the fourth quarter, analysts expected BSFT to produce revenue in the amount of $81.61 million. However, the company actually generated revenue for the quarter in the amount of $89.6 million.
  • Guidance – As if solid earnings and revenue were not enough, BSFT also released guidance for 2016, both first quarter full year. In the first quarter, analysts expect that BroadSoft will generate earnings in the amount of $0.24 per share. However, the company released guidance stating that it expects earnings to range between $0.20 and $0.32 per share in the first quarter. BSFT is also ahead on revenue guidance, expecting to generate between $70 and $74 million in the quarter, compared to the $68.7 million analysts are expecting. Finally, full year guidance is also relatively positive. Throughout the year, the company expects to generate earnings in the range between $1.90 and $2.10 per share. This is on the higher side of analyst estimates at $1.93 per share. The company is also expecting to generate revenue in the range between $332 and $340 million, beating the analyst expectations of $325.1 million.

How The Market Reacted To The News

As investors, we know that any time we see positive news with regard to a publicly traded company, we can expect to see gains in the market as a result. Not to mention, there are few factors that can cause positive movement quite like positive earnings. With that said, BroadSoft is doing incredibly well in the market early this morning as a result of investor excitement over earnings. Currently (9:39), BSFT is trading at $36.76 per share after a gain of $5.29 per share or 16.81% thus far today.

What We Can Expect From BSFT Moving Forward

Moving forward, I have a relatively positive opinion of what we can expect to see from BSFT. In the short term, the stock is likely to continue edging up on investor excitement. However, this isn’t the first time the company has produced solid earnings. In fact, in three out of the past four quarters, the company has blown away earnings expectations. With a strong team, a strong line of products, and a great plan for growth, BSFT is likely to climb from here.

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Where do you think BSFT is headed moving forward? Let us know your opinion in the comments below!

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Baidu BIDU Stock News

Baidu Inc (NASDAQ: BIDU)

Baidu is having an incredible start to the trading session today, and for good reason. The company announced earnings for the fourth quarter of 2015 today, beating revenue expectations and showing strong mobile user growth. Today, we’ll talk about what we saw from the earnings report, how investors reacted to the news, and what we can expect to see from BIDU moving forward. So, let’s get right to it!

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BIDU Reports Solid Earnings

As expected, Baidu reported its earnings for the fourth quarter before the opening bell today. However, what wasn’t expected was the fact that the company would show strong mobile user growth. Here’s what we saw from the earnings report:

  • Top Line Revenue – In terms of top-line revenue, BIDU came in ahead of expectations. For the fourth quarter, it was expected that the company would report revenue in the amount of $2.84 billion. However, the company actually produced revenue in the amount of $2.89 billion.
  • Earnings Per Share – As far as earnings per share goes, the company didn’t do horribly, but didn’t do great either. In fact, BIDU narrowly missed analyst expectations. While analysts expected the company to produce earnings in the amount of $1.19 per share, the company actually produced earnings in the amount of $1.18 per share.
  • Users – While neither earnings nor revenue were enough to really excite investors, there was one part of the report that generated quite a bit of excitement. That part of the report was mobile user growth. Mobile is the next big thing for tech, and it’s arguable that tech companies in some ways are gauged by the amount of mobile users they have. In the case of BIDU, mobile active monthly users grew in a big way year over year. In fact, year-over-year growth in the figure was up 21%, now totaling 657 million! Also when it comes to mobile apps monthly active users, we saw year-over-year growth in the amount of 43%!

All in all, as you can see from the information above, BIDU had an incredibly positive report. Revenue beat, earnings came in just under expectations and mobile users skyrocketed. In a statement, BIDU CEO, Yanhong Li had the following to say:

2015 was a touchstone year for Baidu: we made significant progress in broadening our online marketing platform and further extending our reach into transactions services.”

How The Market Reacted To The News

As investors, we’ve learned that any time positive news is released with regard to a publicly traded company, we can expect to see growth in the value of that company’s stock. While earnings and revenue weren’t quite enough to excite investors, mobile user growth definitely was, and that excitement led to strong growth in the stock today. Currently (10:49), BIDU is trading at $173.55 per share after a gain of $15.33 per share, or 9.69%, thus far today.

What We Can Expect To See Moving Forward

Moving forward, I have a relatively bullish opinion of what we can expect to see from Baidu. The reality is that the company is seeing tremendous growth in mobile users and branching into more and more industries that are likely to lead to strong profits in the long run. All in all, I believe we’re going to see strong growth from BIDU moving forward!

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Where do you think BIDU is headed and why? Let us know your opinion in the comments below!

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Herbalife HLF Stock News

Herbalife Ltd. (NYSE: HLF)

Yesterday, Herbalife declined throughout the day as investors braced for a poor earnings report. However, the earnings report for the company’s fourth quarter came in before the bell today, and proved to be much better than expected. As a result, we’re seeing massive gains on the stock in early trading today. Below, we’ll talk about what we saw from earnings, how investors reacted to the news, and what we can expect to see from HLF moving forward. So, let’s get right to it!

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HLF Produces Solid Earnings

As mentioned above, Herbalife produced its earnings report before the opening bell this morning, beating all expectations and exciting investors. Here’s what we saw from the report:

  • Earnings Per Share – In terms of earnings per share, HLF did incredibly well. During the quarter, analysts expected the company to produce earnings in the amount of $0.94 per share. However, the company actually produced earnings in the amount of $1.19 per share, blowing analyst expectations out of the water with a 26%+ earnings surprise!
  • Revenue – Revenue for the quarter also came in well ahead of expectations. In the fourth quarter, analysts expected HLF to produce $1.06 billion in revenue. However, the company actually generated $1.10 billion in revenue for the quarter.
  • Guidance – As if beating earnings and revenue expectations wasn’t enough to get investors excited, Herbalife also reported guidance for the first quarter as well as the entire 2016 year. For the first quarter, HLF expects to generate between $0.97 and $1.07 per share in earnings. On a full year basis, the company expects to generate earnings per share in the range between $4.05 and $4.50.

How The Market Reacted To The News

As investors, we’ve learned that any time we see positive news with regard to a publicly traded company, we can expect to see gains in the value of the stock associated with that company. Not only that, there are few pieces of news that have the ability to move the needle quite like strong earnings. So naturally, after producing an overwhelmingly strong earnings report, HLF is currently climbing in the market in a big way. Currently (10:12), the stock is trading at $56.55 per share after a gain of $10.79 per share or 23.58% thus far today.

What We Can Expect To See Moving Forward

Moving forward, I have an overwhelmingly bullish opinion of what we can expect to see from HLF. The reality is that investors are ultimately investing for growth and Herbalife is a great place to realize growth. The company has a strong earnings history, beating earnings expectations over the past 4 consecutive quarters. On top of strong earnings, HLF has a solid line of products, a great team, and a solid plan for growth moving forward. All in all, things are looking great for the stock and all who decide to get involved.

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What Do You Think?

Where do you think HLF is headed and why? Let us know your opinion in the comments below!

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Allergan AGN Stock News

Allergan (NYSE: AGN)

Allergan is having a strong start in the market today, and for good reason. The company recently reported earnings for the fourth quarter of 2015, beating expectations. Today, we’ll take a look at the earnings report, how the market reacted to the news, and what we can expect to see moving from AGN forward. So, let’s get right to it!

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AGN Produces Better Than Expected Earnings

As mentioned above, Allergan released its earnings report for the fourth quarter of 2015, as expected, early this morning. However, what the company produced with regard to earnings was well ahead of what analysts expected to see. Here’s what we saw from the AGN earnings report:

  • Revenue – In terms of revenue, AGN did well, but didn’t blow away expectations. In fact, the company hit the nail on the head. For the fourth quarter, analysts expected for the company to generate $4.2 billion in revenue. That was exactly the amount that was produced. No beat, no miss.
  • Earnings Per Share – In terms of earnings per share, AGN did far better than what we saw from revenue. The company blew away analyst expectations. When it comes to earnings, for the fourth quarter, analysts expected the company to produce earnings per share in the amount of $3.36. However, the company actually produced earnings per share in the amount of $3.41, beating expectations by $0.05.
  • Guidance – In terms of guidance for the fiscal year 2016, AGN came in below analyst expectations. The overall opinion of analysts is that the company should produce about $17.66 billion in revenue throughout the year. However, Allergan actually reported guidance stating that they expect to see revenue in the $17 billion area.

How The Market Reacted To The News

As investors, we have learned that earnings are one of the biggest drivers of movement in the market. When a company produces solid earnings, we can expect to see strong bullish movement on the stock associated with that company. Adversely, when a company produces negative earnings, we can expect to see poor movement on the stock as a result. So naturally, after beating earnings expectations, AGN is climbing in the market. Currently (9:19), Allergan is trading at $280.01 after a gain of $4.26 per share or 1.54% thus far today.

What We Can Expect From AGN Moving Forward

Moving forward, I have a relatively bullish opinion of what we can expect to see from AGN. When we talk about Allergan, we’re talking about one of the largest biopharmaceutical companies in the world. The company has a long list of products that do incredibly well in the market and is consistently working to expand their product line. With an incredibly strong earnings history, AGN has proven its ability to produce growth. Allergan has an impressive management team, strong staff, and a clear plan for growth, and since investors ultimately invest for growth, they give investors great reasons to be bullish. All in all, things look great for AGN moving forward.

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What Do You Think?

Where do you think AGN is headed moving forward? Let us know your opinion in the comments below!

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NVIDIA Corporation NVDA Stock News

NVIDIA Corporation (NASDAQ: NVDA)

NVIDIA Corporation is having an incredible start to the trading session today, and for very good reason. Yesterday, the company reported its earnings for the most recent quarter after the closing bell, beating all expectations. Today, we’ll talk about what we saw from earnings, how the market reacted to the news, and what we can expect to see from NVDA moving forward. So, let’s get right to it…

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NVDA Reports Solid Earnings

As mentioned above, NVIDIA reported its earnings for the fiscal fourth quarter yesterday after the closing bell. However, the earnings report was a shocker as the company blew away expectations and produced record results. Here’s what we saw:

  • Earnings Per Share – In terms of earnings per share, analysts expected for NVDA to report earnings in the amount of $0.32 per share. However, the company actually produced record earnings at $0.52 per share, absolutely blowing away analyst expectations.
  • Revenue – In terms of top-line revenue, NVDA also did incredibly well. While analysts expected the company to produce $1.31 billion in overall revenue for the quarter, the company actually produced $1.4 billion in revenue for the quarter. Not only does this figure beat expectations, it shows a 12% year-over-year growth in top line revenue, driven by sales of graphics processing units for gaming and professional visualization.

On top of beating earnings and revenue projections, the company also announced guidance for the first quarter above expectations. While analysts expect the company to generate $1.22 billion in the quarter, NVDA is expecting to generate around $1.26 billion. In a statement, Jen-Hsun Huang, co-founder and CEO of NVIDIA Corporation had the following to say:

We had another record quarter, capping a record year. Our strategy is to create specialized accelerated computing platforms for large growth markets that demand the 10x boost in performance we offer. Each platform leverages our focused investment in building the world’s most advanced GPU technology… NVIDIA is at the center of four exciting growth opportunities – PC gaming, VR, deep learning, and self-driving cars. We are especially excited about deep learning, a breaktrhough in artificial intelligence algorithms that takes advantage of our GPU’s ability to process data simultaneously.”

How The Market Reacted To The News

As investors, we know that few factors have the ability to move the market quite like earnings. After all, investors are ultimately investing for growth, and earnings give them a way to gauge growth. With that said, following the overwhelmingly positive earnings report from NVDA, the stock is climbing in a big way. Currently (9:36), the stock is trading at $30.55 per share after a gain of $2.89 per share or 10.45% so far today.

What We Can Expect To See Moving Forward

Moving forward, I have a relatively bullish expectation of what we can expect to see from NVIDIA. The reality is that the company has proven its ability to grow and that demand for its products are high. So, I wouldn’t expect the growth trend to stop any time soon. However, it is important to remember that the market tends to move through a series of overreactions. Therefore, it wouldn’t be surprising to see a slight correction, bringing NVDA off of highs in the short term. Nonetheless, in the long term, I’m expecting this stock to soar!

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What Do You Think?

Where do you think NVDA is headed moving forward? Let us know your opinion in the comments below!

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Rackspace Hosting RAX Stock News

Rackspace Hosting, Inc. (NYSE: RAX)

Rackspace is having a rough day in the market today, and for good reason. After the closing bell yesterday, the company reported earnings. While earnings and revenue came in ahead of expectations, they also showed a negative trend. On top of that, guidance was off quite a bit. Today, we’ll talk about what we saw from the earnings report, how the market reacted to the news, and what we can expect to see from RAX moving forward. So, let’s get right to it…

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RAX Produces Solid Earnings… But There’s A Catch!

As mentioned above, RAX reported earnings for the most recent quarter yesterday after the closing bell. While there was mixed data in the earnings report, all signs seemed to be pointing toward negativity. Here’s what we saw from Rackspace on earnings:

  • Earnings Per Share – When it comes to earnings per share, the results were a bit mixed. While analysts expected RAX to produce earnings in the amount of $0.24 per share, the company actually produced earnings in the amount of $0.31 per share. While that may seem to be positive, this does suggest a decline. After all, in the same quarter one year ago, Rackspace Hosting reported earnings in the amount of $0.36 per share.
  • Revenue – Overall, revenue came in relatively positive. In the quarter, analysts expected that RAX would produce revenue in the amount of $521 million. However, the company actually produced revenue in the amount of $523 million. This also came in well ahead of the same quarter one year ago when the company reported revenue in the amount of $473 million.
  • Guidance – With mixed results on earnings and positive results on revenue, RAX really needed guidance to hold things together. However, unfortunately, that was not the case. For the first quarter of 2016, RAX expects to produce revenue in the range between $517 million and $521 million. This is well below analyst expectations for the quarter in the amount of $529 million, causing concern among investors.

How The Market Reacted To The News

As investors, we know that there are few factors that have the ability to move the market quite like earnings. While there were definitely some positive aspects in the RAX earnings report, there was also quite a bit of negative. Ultimately, it came down to guidance breaking the tie between bearish and bullish sentiments. Unfortunately, guidance was negative overall, leading to a negative sentiment on the stock and, in the end, declines in value. Currently (10:38), RAX is trading at $17.73 per share after a loss of $0.44 per share or 2.42% so far today.

What We Can Expect To See Moving Forward

Moving forward, I have a relatively bearish opinion of what we can expect to see from Rackspace moving forward. The reality is that when we talk about RAX, we may be talking about the BlackBerry of online hosting. When there was little competition in the cloud, the company did incredibly well. However, now that the company has to compete with the likes of Amazon Web Services, there’s quite a bit changing for them. While I hope that I’m wrong here, I think that RAX is falling behind in the industry and that this will show when looking at earnings, revenue, and ultimately, their stock moving forward!

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Thought Leader Discussions

Gevo, Inc. GEVO Stock News

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Gevo, Inc. (NASDAQ: GEVO) Before we get into this interview, I'd like to extend a special thanks to my friend Joey who both set up the...