RSSWhat crisis? IBM spoils the bears' day with good Q3 news
By Scott M. Fulton, III | Published October 9, 2008, 11:44 AM
Usually when a company these days gives advance warning to the press about earnings numbers that aren't due for another week, it's to help diffuse a negative backlash. Not this time, as IBM handed the market a rare gift.
In an SEC filing this morning, IBM went out of its way to bring good tidings of great earnings for a market that could really use a little Christmas cheer even two months early. Total revenues for the third quarter of this year for the company will be up 5% annually to $25.3 billion; and with margins rising, its net income will likely be up as much as 20% on the year, to $2.8 billion.
Back in April, analysts were expecting IBM's full-year earnings for 2008 to approach $8.50 per share, and that was considered good. This morning, IBM told the SEC it expects to reach $8.75 per share by the end of the year, and re-affirmed its confidence in guidance numbers to support that figure.
But the stock market has been wearing blue for a different reason all this week; and even as IBM's great news was heralded, it could do little to put the skids on a multi-day selloff. By 11:00 am EDT, the Dow 30 Industrials had traded as low as 200 points below the previous day's close, having lost 191 points the previous day, though there was a bit of a rally by 11:15, tapering losses to just over 100 points.
The fact that IBM stock was trading down a half-point at just over $90 per share by late morning could even be seen as bucking the trend.
In a statement last week, IBM Tivoli general manager Al Zollar took a different approach than Novell, capitalizing on HP customers' anger and resentment rather than playing the white knight. "HP's decision to throw in the towel on its identity and access management software line," Zollar said, "has left a void for customers. Obviously security software is a critical linchpin for protecting a company's global assets and reputation. IBM is committed to delivering a comprehensive portfolio of security software and services."
Now, if only IBM had an "insecurity" solution for the rest of the market.
Well people,
I give it about two weeks before we see a complete world economic collapse and complete chaos ensues. The dow is going to drop to about 3,000 before this is all over.
As much as we joke around and call each other names in here, I wish you all the best of luck. I hate people who are always running around yelling the sky is falling at the hint of trouble but this is the real deal.
Since BetaNews is oblivious to real news and this is the only story even closely related to the world stock market melting down before our eyes, I thought I'd post it in here.
Do you realize the market has lost over 5,500 points since October of 2007? That is over one third of it's value in a single year.
Oh yes, and it has dropped 2270 of those 5500 points in the last seven trading days.
I'm predicting a 1200+ point drop for tomorrow, which will be the new "Black" Friday the history books will refer to. Monday will see another 1000+ point drop.
I sincerely hope I'm wrong but this runaway freight train hasn't hit full speed yet thanks to all the people who have no clue about what they signed when they bought the overpriced house they couldn't afford in the first place and the banks that loaned them the money knowing they would eventually default.
Most people who got shafted had no clue the payments would double, even triple after one year with these crazy loans.
I'm just glad our house is paid for and we didn't sell it when it was appraised at some ridiculously overinflated price a couple years ago.
The greedy arabs and foreigners around here started scarfing up 3 and 4 houses at a time, thinking they were going to clean up. They are all bankrupt. Good riddance to all these non American morons. We are thinking of buying a foreclosed house right down the street dirt cheap and renting it out.
My cousin is a real estate agent and she has told us some stories you wouldn't believe. Now is the time to cash in on other peoples stupidity.
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|The dow is going to drop to about 3,000 before this is all over.
Some history:
In 1987, it was @ 2000, and this was considered a bull market.
In 1995, Fannie Mae began receiving affordable housing credit for buying subprime securities.
In 1995, Freddie Mac began receiving affordable housing credit for buying subprime securities.
In Nov of 1995, the Dow hit a record setting high of 5000.
We've been on an artificially created inflation of the DJIA ever since.
In 1999, the Clinton administration and Fannie Mae shareholders encouraged the lender to increase the number of mortgage loans offered to those of low and moderate income.
I fully expect the DJIA to fall back to pre-1995 levels. I would be disappointed otherwise.
No doubt it will be a "rough couple of years", at least comparatively. I don't see anything indicating that the end of the world is nigh, however...
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|"Good riddance to all these non American morons"
LOL. Yeah! Let's replace them with lazy, entitled, full of them selves, uneducated, arrogant and brainwashed slobs that can take care of themselves so well.
Let me know when you are done with this project so I can stop replacing your jokers by the bulk load to get anything done.
Uh Oh - chicken and egg...
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|So what. Dell did the same thing during a downturn and ended up having to restate earnings later on. I think this is bs and aimed at making a point for their marketing pukes. The true test will be if this holds up a year from now without being restated.
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|wow. What a herd. IBM is one company, now what about the hundreds of thousands of smaller ones?
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|That, and the vast majority of IBM's business is *not* to the consumer.
Comparing them to HP? What a joke...
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|Wow, toolie's socialism doesn't consider business a consumer. What a surprise from a nutjob. Let me guess toolie, were you "Harvard edujamacated" like your buddies obama, bush, and your favorite dropout, billy gates?
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|Hey, genius, who's getting hit harder by "credit crunch"? Businesses or consumers?
doesn't consider business a consumer.
No, I don't. They don't affect the economy or the stock market in anywhere near the same way.
...and we *are* talking about the economy. Or did you miss that part?
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|The big question is whether the revenue from Q3 is mostly from contract revenue being distributed over the year. If the service contracts were actually acquired in Q1, then this would not be based on current market conditions and Q4 will be a huge decline and still support a bear market.
http://afewtips.com
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