#$cuda

EARNING UPDATE $CUDA Barracuda Networks, Inc. for quarter ending q_Nov17 – Revenue grew, Margins expanded

Barracuda Networks, Inc. reported earnings (EPS) of 0.14 per share for the quarter ending q_Nov17 compared to 0.03 per share for the previous quarter ending q_Aug17, a growth of 366.7 %. However, the EPS declined compared to the same quarter last year (q_Nov16) indicating worsening business..Stock has a market cap of USD$ 1461.99 million . The 52Week high is at 27.94 and the 52week low is at…

Alcoa (AA): Alcoa kicks off earnings season, as it usually does, with its earnings report tomorrow afternoon. This will be the company’s last report before it splits its parts business from its legacy metal making operations. The move will create two publicly traded companies, Alcoa and the newly formed Arconic. Alcoa will handle its legacy aluminum business while Arconic will manage the value added business. This includes global rolled products, engineered products and solution and transportations and construction solutions. These segments should continue to grow given their use in aerospace and the tech industry. Companies such as Boeing, Lockheed Martin and Ford Motors are clients of Alcoas.  Nonetheless the company’s overall earnings have struggled lately. Alcoa is coming off multiple quarters of negative growth with the stock trending in the same direction. Global market uncertainty and historically weak metal prices should pose near term headwinds even after the company splits.

Fastenal Company (FAST): Shares of Fastenal are down over 6% after the company delivered weaker than expected earnings and revenue. The quarter ended with a 2.6% increase on the top line and a 4% decline on the bottom. Fastenal provides wholesale distribution services to the manufacturing and non-residential construction markets which have otherwise struggled. This could explain the downturn in earnings the company has been seeing lately. Meanwhile an unfavorable product mix combined with competitive and pricing pressures are having an adverse impact on margins. One bright spot lately has been in its industrial vending machines business. Last quarter 58,350 machines were installed, reflecting a 15.3% increase from the second quarter of 2015.

Barracuda Networks (CUDA): Barracuda Networks is coming off two consecutive beats that have caused shares to jump 60% in the past 6 months. Prior to that the company had fallen victim to a common problem hurting the tech space; decelerating revenue and weak margins. The past 2 quarters have put those concerns to rest as they continue to build on the need for cybersecurity. Last quarter the company deployed its NextGen Firewall services and picked up on the momentum in the cloud computing space. More recently they have introduced a new email scanner for Microsoft Office 365 that will detect and eliminate threats as they occur. Analysts’ expectations are rather muted, suggesting we could see a repeat performance from Barracuda tomorrow afternoon.

Blackhawk Network Holdings (HAWK): Blackhawk is best known for providing branded value through gift cards, digital payments and loyalty points worldwide. The company has made steady gains in recent quarters but that hasn’t translated to the stock. Shares are down 27% year to date despite positive growth on the top and bottom line. Last quarter, adjusted operating revenue jumped 10% on strong growth throughout Europe. The delay in implementing EMV technology in the United States has negatively impacted this portion of business. Its U.S. retail segment reported a 10% revenue decline in the second quarter primarily due to these delays. Given how the stock has trended don’t expect much positive movement even if the earnings report is better than expected.

VMware, Inc. (VMW) Information Technology - Software | Reports April 19, After Market Closes

Key Takeaways

The Estimize consensus is calling for earnings per share of 96 cents on $1.68 billion in revenue, 1 cent higher than Wall Street on the bottom line and $5 million on the top

VMware continues to make major advancements in new and old products which has them well positioned in the fast growing cloud space

VMware faces a number of near term risks including stiff competition, soft IT spending and economic uncertainty in some of its key markets

What are you expecting for VMW? Get your estimate in here!

Cloud computing has been the fastest growing industry in the tech space over the past 5 years consisting of three major components; SaaS, IaaS, and PaaS. One of the leaders in SaaS has been the fast rising VMware. This Monday, VMware is scheduled to report Q2 earnings with hopes that its robust package of services and products will carry the stock to new heights. Shares of VMware just breached their 50 day moving average, momentum on their side heading into Monday’s report.

The Estimize consensus is calling for earnings per share of 96 cents on $1.68 billion in revenue, 1 cent higher than Wall Street on the bottom line and $5 million on the top. Compared to a year earlier this represents a 4% increase in earnings and 5% in sales. Shares are up 15% in the past 6 months but over a year they have dipped 25.8%.

On the heels of its report, Barracuda announced strong quarterly results that sent shares surging over 25%. Both Barracuda and VMware’s businesses are highly related so good news for one often implies good news for the other. There is already a high likelihood that VMW beats estimates this Monday. On average the company beats Wall Street and Estimize in 99% and 79% of reported quarters, respectively. VMware is well positioned to leverage its leading position in the virtualization market to other markets such as data centers, hybrid cloud and mobile devices. These three markets will likely be the fastest growing segments in cloud computing over the next several years. VMware also continues to form strong partnerships and ended 2015 with relationships with Samsung and Google.

During the quarter the company has released updates to its VMware Workspace ONE and announced a new endpoint security solution power by Tanium. They have also seen an uptick in colleges implementing their products.

A few major concerns still stand in the way of its success, including stiff competition, soft IT spending and macroeconomic uncertainty in some of its key markets. Currently, the company operates in the same environment as Microsoft, Citrix and Amazon. Staunch competition has initiated a pricing war within the industry, effectively marginalizing profits and margins. Do you think VMW can beat estimates? There is still time to get your estimate in here!

Financial markets constantly swing between sentiment extremes – from fear of missing out to fear of losing, from complacency to second-guessing yourself, from enthusiasm to apathy. The majority of people tend to lean in the wrong way at pivot points. I like to look for anecdotal evidence of the latter on social media. For example, in the midst of the selloff on Thursday, I posted the following poll on Twitter:

About an hour after posting it, the market rallied hard. At the time, the results were predominantly in favor of “there’s no reason to be long here”. I didn’t have a time machine. I just noticed that indexes were down a few days in a row, an increasing number of stocks were finding support, the McClellan indicator reached levels that led to a bounce in the near past.

The same scenario repeated last week when many index and sector ETFs were had overbought RSI readings and more and more stocks were breaking down. Most people were super complacent at the time. Here’s a poll I posted on June 7th, shortly before the stock market dived.