The U.S. stock market opened higher on Friday with the three main indexes in green. Two stocks moving upward are Applied Materials and Estée Lauder.
Shares of Applied Materials Inc.(AMAT, Financial) were up about 3.6% in morning trading on the back of the company reporting better-than-expected earnings for its third quarter. EPS of 86 cents beat expectations by two cents and revenue of $3.74 billion beat estimates by $50 million and grew 32.6% year over year.
Net sales increased 33% to $3.74 billion and the gross margin gained 3.1 basis points to 45.4%. Further, the operating margin inched up by 6.2 basis points to 27.3%. EPS increased 85% to 85 cents. On a non-GAAP adjusted basis, the company increased the gross margin to 46.6%, grew the operating margin by 5.9 basis points to 28.7% and increased EPS by 72% to 86 cents.
“With revenue and profits at all-time highs, Applied has tremendous momentum and a very positive outlook for the future," President and CEO Gary Dickerson said. "Our markets are growing with a broader set of demand drivers, and the breadth of Applied’s technology enables us to play a larger and more valuable role advancing the innovation roadmap in semiconductor and display.”
Guidance is solid. The company expects net sales for the next quarter to be in the range of $3.85 billion to $4 billion; the midpoint would be an increase of 19%year over year. Non-GAAP adjusted diluted EPS is expected to be in the range of 86 cents to 94 cents; the midpoint would be an increase of 36% year over year.
The Estée Lauder Companies Inc. (EL, Financial) jumped more than 4% as the company posted fourth-quarter EPS of 51 cents on revenue of $2.89 billion, beating profit estimates by eight cents per share and revenue by $40 million. Revenue increased 9.1% during the period.
Gainers
Ross Stores Inc. (ROST, Financial), The Gap Inc. (GPS, Financial), Calpine Corp. (CPN, Financial) and Opko Health Inc. (OPK, Financial).
Losers
Foot Locker Inc. (FL, Financial), Deere & Co. (DE, Financial), Nike Inc. (NKE, Financial) and Under Armour Inc. (UAA, Financial).
Global markets
The main European markets traded lower. The FTSE 100, German DAX, French CAC 40 and the IBEX 35 lost approximately 0.9%. Spanish stocks led the sell-off after the Barcelona terrorist attack.
In Asia, markets closed lower overall. China’s Shanghai Composite Index is the only one in green territory. Japan’s Nikkei, Hong Kong’s Hang Seng Index and India’s BSE Sensex closed down.
Disclosure: The author holds no positions in any stocks mentioned.
