U.S. Home Prices Rise, Facebook Earnings Fall 12%

Arthi Gupta
24 Apr, 2012
New York City

U.S. indexes edged slightly higher after metropolitan home price index rose in February. Microsoft agreed to sell few of AOL patents to Facebook for $550 million. Hedge fund takes a 12% stake in Barnes & Noble.

[R]9:45 AM New York – U.S. indexes edged slightly higher after metropolitan home price index rose in February. Microsoft agreed to sell few of AOL patents to Facebook for $550 million. Hedge fund takes a 12% stake in Barnes & Noble.[/R]

U.S. indexes edged higher in early trading after a report showed that home prices rose in February. Better-than-estimated earnings too lifted sentiment.

Traders look ahead to the 2-day FOMC meeting scheduled to start today.

However, market indexes across Europe pared gains after Spain, Italy and The Netherlands completed debt offerings but yields rose sharply from the previous auctions.

Indexes fell more than 2% yesterday after Dutch government failed to agree on a budget and President Sarkozy in France trailed in the first round of Presidential election.

Asian markets were mixed after Australia reported weaker than expected consumer price inflation and the benchmark index in Japan extended losses for the fourth day in a row as the yen advanced.

U.S. Home Prices Rise

Home prices in major U.S. metropolitan areas rose in February, according to a report released by Standard & Poor''s today.

The controversial S&P/Case-Shiller 20-City Composite Home Price Index gained 0.2% in February on a seasonally adjusted basis.

Microsoft, Facebook Patents Deal

Microsoft Corp. agreed to sell a portion of the patent portfolio it recently agreed to acquire from AOL Inc. to social networking company Facebook Inc. for $550 million in cash.

As a result of the agreement, Facebook will obtain ownership of approximately 650 AOL patents and patent applications, plus a license to the AOL patents and applications that Microsoft will purchase and own.

Jana Partners Owns Stake in Barnes & Noble

Jana Partners, the hedge fund in a regulatory filing said it owns about 7 million shares of Barnes & Noble, representing a stake of 11.6%. Jana Partners also said it has an option to buy an additional 250,000 shares at a price of $13 each.

Earnings Review

AT&T Inc. ((T)), the telecom operator said first quarter consolidated revenues gained 1.8% to $31.82 billion from $31.25 billion in the year-earlier quarter. Net income for the quarter increased 5.2% to $3.58 billion or 60 cents per diluted share compared to net income of $3.41 billion or 57 cents per share last year.

The company posted a net increase in total wireless subscribers of 726,000 in the first quarter to reach 103.9 million accounts in service.

3M Co. ((MMM)), the diversified technology company reported first quarter net sales for the quarter rose 2.4% to $7.49 billion from $7.31 billion in the prior year quarter. Net income for the quarter climbed 4% to $1.13 billion or $1.59 per diluted share compared to net income of $1.08 billion or $1.49 per share in the same quarter last year.

Facebook, Inc., the social networking service that expects to list its stock in a month said first quarter total revenue rose 45% to $1.06 billion from $731 million in the same quarter last year. Net income in the quarter declined 12% to $205 million or 9 cents per share compared to net income of $233 million or 11 cents per share in the prior year quarter.

Facebook had 901 million monthly active users as if March 31, 2012, up 33% from the quarter a year ago.

RadioShack Corporation ((RSH)), the consumer electronics retailer said first quarter net sales and operating revenues declined 0.9% to $1.01 billion compared to $1.02 billion for the 2011 first quarter. Net loss in the quarter swung to $8 million or 8 cents per diluted share compared to net income of $35.1 million or 33 cents per share last year.

The Hershey Company ((HSY)), the candy maker reported first quarter net sales advanced 10.7% to $1.73 billion from $1.56 billion in the same quarter last year. Net income in the quarter climbed 24% to $198.65 million 87 cents per diluted share compared to net income of $160.12 million or 70 cents per share in the prior-year quarter.