U.S. Mortgage Activity Drops; Yahoo! Net Surges, WellPoint Net Plunges

Arthi Gupta
26 Jan, 2011
New York City

U.S. indexes traded higher tracking gains in Europe and Asia. U.S. mortgage applications slid after refinancing activity slumped. Concur completed acquisition of TripIt. Yahoo! quarterly profit doubled but WellPoint net plunged.

[R]9:00 AM New York – U.S. indexes traded higher tracking gains in Europe and Asia. U.S. mortgage applications slid after refinancing activity slumped. Concur completed acquisition of TripIt. Yahoo! quarterly profit doubled but WellPoint net plunged.[/R]

President Barack Obama speaking in his second State of the Union Address and third address to a joint session of Congress said that the American people want Democrats and Republicans to work together after the success of the bipartisan deal to extend tax cuts and unemployment benefits achieved in the December session of Congress.

""We have more work to do. The steps we''ve taken over the last two years may have broken the back of this recession - but to win the future, we''ll need to take on challenges that have been decades in the making,"" he said.

U.S. Home Price Index Falls

Home prices in 20 major metropolitan areas in the U.S. showed a notable decrease in November compared to the same month a year ago, according to a report released by Standard & Poor''s.

The report showed that the S&P/Case-Shiller 20-City Composite Home Price Index fell at an annual rate of 1.6% in November compared to the 0.8% drop reported for October.

U.S. Consumer Confidence Climbs

The Conference Board released a report showing that U.S. consumer confidence rebounded by much more than anticipated in January.

The Conference Board said its consumer confidence index jumped to 60.6 in January from an upwardly revised 53.3 in December.

U.S. Mortgage Activity Slumps

U.S. mortgage applications declined last week as refinancing activity plunged amid rising interest rates and tougher credit conditions, industry data showed.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity dropped 12.9% in the week ended January 21.

Refinancing applications decreased 15.3% from the previous week and applications for new purchases decreased 8.7% from one week earlier.

Merrill Settles SEC Fraud Charges

The U.S. Securities and Exchange Commission said that it charged Bank of America Corp.''s Merrill Lynch unit with securities fraud for misusing customer order information to place proprietary trades for the firm and for charging customers undisclosed trading fees.

Merrill agreed to pay a $10 million penalty and consent to a cease-and-desist order to settle the SEC''s charges, the agency said.

Concur Completes Acquisition of TripIt

Concur, a provider of integrated travel and expense management solutions completed the acquisition of privately held TripIt – the market leader in mobile trip management that helps travelers easily organize and share travel plans no matter where they book.

Concur agreed to pay approximately $82 million in cash, stock and unvested restricted stock units, and additional consideration over time that could bring the total value to $120 million

CSX Plans Strengthening Rail Network

CSX Corporation plans to invest $2 billion to increase the quality, flexibility and capacity of its rail network in addition to the $1.8 billion the company invested in 2010. The company also said today that it will increase employment by 1% to 2% in 2011 as business continues to return in an improving economy.

Icahn Extends Tender Offer

Icahn Enterprises L.P. said its wholly-owned subsidiary, IEH Merger Sub LLC extended the expiration date of its previously announced tender offer for all outstanding shares of common stock, including the associated rights, of Dynegy Inc. for $5.50 per share in cash, without interest and less any applicable withholding taxes, until 5:00 p.m., New York City time, on February 9.

Earnings Review

Altera Corporation ((ALTR)), the semiconductor company reported fourth quarter net sales increased 52% to $555.38 million from $365.00 million a year ago. Net income in the quarter surged 125% to $231.61 million or 72 cents per diluted share compared to net income of $102.97 million or 34 cents per share in the previous year.

Net sales for the year rose to $1.39 billion from $0.80 billion last year. For the full year 2010, net income increased to $782.88 million or $2.49 per share from $251.06 million or $0.84 per share in the previous year.

Boston Properties, Inc. ((BXP)), the real estate investment trust reported fourth quarter total revenue increased 4.3% to $392.48 million from $376.13 million last year. Net loss in the quarter was $12.90 million or 9 cents per diluted share compared to an income of $53.32 million or 38 cents per share in the previous year.

CA, Inc. ((CA)), the independent enterprise information technology (IT) software and service company reported third quarter revenues grew 4% to $1.16 billion from $1.12 billion in the year-ago quarter, largely on higher sales of service assurance, virtualization management and service automation products, and service and education offerings. Net income in the quarter declined 22% to $200 million or 39 cents per diluted share compared to net income of $257 million or 49 cents per share last year.

Gilead Sciences, Inc. ((GILD)), the biopharmaceutical company reported fourth quarter total revenues declined 1.5% to $2.00 billion from $2.03 billion a year ago. Net income in the quarter declined 21.5% to $629.42 million or 76 cents per diluted share compared to net income of $802.21 million or 87 cents per share in the previous year.

For the full year 2010, total revenues rose to $7.95 billion from $7.01 billion a year ago. Net income for the year increased to $2.90 billion or $3.32 per share from $2.63 billion or $2.82 per share last year.

Juniper Networks, Inc. ((JNPR)), the computer networking gear maker said fourth quarter total revenue rose 26% to $1.19 billion from $941.45 million in the same quarter last year. Net income in the quarter soared 731% to $190.2 million or 35 cents per diluted share compared to net income of $22.9 million or 4 cents per share for the year-ago quarter.

Total revenue for the full year 2010 rose 23% to $4.09 billion from $3.32 billion the prior year. For the full year 2010, the company reported net income of $618.4 million or $1.15 per share, compared to $115.2 million or $0.22 per share for the full year 2009.

Norfolk Southern Corp. ((NSC)), the railroad network operator reported fourth quarter revenues rose 14% to $2.39 billion from $2.10 billion in the year-ago period. Net income in the quarter increased 31% to $402 million or $1.09 per diluted share compared to net income of $307 million or 82 cents per share last year.

Railway operating revenues for the full year increased 19% to $9.51 billion from $7.97 billion for the previous fiscal year. For the full year, net income increased 45% to $1.5 billion from $1.0 billion for fiscal 2009. On a per-share basis, earnings for the full year rose to $4.00 per share from $2.76 per share in 2009.

Praxair, Inc. ((PX)), the industrial gas producer reported fourth quarter sales grew 9% to $2.62 billion from $2.41 billion in the same quarter last year. Net income in the quarter plunged 61% to $133 million or 43 cents per diluted share compared to net income of $340 million or $1.09 per share in the prior-year quarter.

Sales for the full year increased 13% to $10.12 billion from $8.96 billion posted in the previous year. For fiscal 2010, the company posted net income of $1.20 billion or $3.84 per share, lower than $1.25 billion or $4.01 per share in the prior year.

Stryker Corporation ((SYK)), the orthopedic device maker said fourth quarter net sales rose 8.8% to $2.00 billion from $1.83 billion in the same quarter last year. Net income in the quarter declined 3.6% to $295.0 million or 74 cents per diluted share compared to net income of $306.0 million or 76 cents per share for the year-ago quarter.

Net sales for the full year 2010 rose 8.9% to $7.32 billion from $6.72 billion the prior year. For the full year 2010, the company reported net income of $1.27 billion or $3.19 per share, compared to $1.11 billion or $2.77 per share for the full year 2009.

WellPoint, Inc. ((WLP)), the health benefits company stated fourth quarter total revenues slipped 23.1% to $14.65 billion from $19.05 billion in the comparable period a year ago. Net income in the quarter plunged 80% to $548.8 million or $1.40 per share compared to net income of $2.74 billion or $5.95 per share last year.

Full-year 2010 total revenues slipped 9.6% to $58.82 billion. Net income in the period fell to $2.89 billion or $6.94 per share from last year''s $4.75 billion or $9.88 per share.

Yahoo! Inc. ((YHOO)) said fourth quarter revenue fell 12% to $1.53 billion from $1.73 billion in the same quarter last year, due to the required change in revenue presentation and the revenue share with Microsoft associated with the search agreement. Net income in the quarter surged 104% to $312 million or 24 cents per diluted share compared to net income of $153 million or 11 cents per share in the prior-year quarter.

Annual revenue declined 2.2% to $6.32 billion from $6.46 billion a year ago. For the full year 2010, net income grew 106% to $1.23 billion or $0.90 per share from $598.00 million or $0.42 per share in the previous year.