Archive for October, 2010

Earnings Preview: Corning to report 3Q results

Friday, October 29th, 2010 | Finance News

ROCHESTER, N.Y. – Corning Inc., the world's biggest maker of glass for flat-panel televisions and computers, reports its third-quarter results before the stock market opens Monday.

WHAT TO WATCH FOR: Steady year-over-year growth in the liquid-crystal-display glass market as retail sales of LCD TVs remain strong. Analysts also anticipate a rapid expansion in Corning's Gorilla business as the ultra-strong glass looks poised to migrate from cell phones and computer tablets to high-end TVs.

The glass pioneer expects LCD glass volume will slip 5 percent from an unusually high plateau in the second quarter. Some Asian panel makers have been moderating production to avoid an inventory buildup. The company had previously forecast that volume would remain flat.

The slowdown is pressuring Corning to yield on pricing and could dampen its fourth-quarter outlook.

Corning expects to sell 2.9 billion to 3.1 billion square feet of LCD glass this year, up from 2.45 billion square feet in 2009. The ultrathin, unvaryingly smooth glass generates the bulk of its profits and revenue, which reached $5.4 billion in 2009.

The company has high hopes for Gorilla, a highly popular protective sheath for mobile devices. After generating $80 million in revenue in 2009, the business might pick up its first profit in 2010. Soaring demand could boost sales of the scratch-resistant glass to $1 billion next year.

WHY IT MATTERS: As LCD-TV market penetration in the U.S. reaches 90 percent, China will become the global leader in total TV sales — some 70 percent of them LCD models. Corning projects the Chinese market could rise 32 percent this year to 37 million LCD-TVs. It already plans to build an $800 million, advanced LCD glass plant in Beijing, with operations to start in the first half of 2012.

Based in western New York, Corning also makes auto-pollution filters and is the world's largest producer of optical fiber and cable. It employs 24,500 people.

WHAT'S EXPECTED: Analysts polled by Thomson Reuters, whose estimates typically exclude one-time items, expect Corning to earn 52 cents per share on revenue of $1.61 billion.

LAST YEAR'S QUARTER: Corning reported net income of $643 million, or 41 cents a share, on sales of $1.48 billion.


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Immigrants in US gain jobs, native-born lose: study

Friday, October 29th, 2010 | Finance News


WASHINGTON (AFP) – Immigrant workers have gained more than half a million jobs in the United States since the end of the Great Recession last year, while US-born workers continued to lose jobs in the same period, a study released Friday shows.

Immigrants of all races and ethnicities gained 656,000 jobs in the 12 months from June last year, when data showed that the worst recession since the Great Depression in the 1930s had ended, the study by the Pew Hispanic Center shows.

US-born workers, on the other hand, lost 1.2 million jobs in the same period, the study shows.

The unemployment rate for immigrant workers fell in the first year of the recovery from 9.3 percent to 8.7 percent, while for native-born workers, it rose from just over nine percent to nearly 10 percent, the study shows.

But even though the jobs situation looked better for immigrants than the native-born, foreign-born workers have a long way to go before they have fully recovered from the effects of the recession.

"The 650,000 jobs immigrants gained in the first year of the recovery are not nearly sufficient to make up for the 1.1 million jobs they lost" in the recession, the report says.

The unemployment rate for immigrant workers is still more than double what it was before the recession, when only four percent of foreign-born workers were out of a job.

And "even as immigrants have managed to gain jobs in the recovery, they have experienced a sharp decline in earnings," said Pew, which analyzed Census Bureau and Department of Labor data for the report.

The median weekly earnings of foreign-born workers have fallen by 4.5 percent since last year, with Latino immigrants seeing the largest wage drop of all, at 5.8 percent.

Native-born workers' wages fell by less than one percent.

"It might be that in the search for jobs in the recovery, immigrants were more accepting of lower wages and reduced hours because many, especially unauthorized immigrants, are not eligible for unemployment benefits," the report says.

Foreign-born workers are also thought to be more flexible and willing to change professions and move house for a job than their native-born counterparts, the report says.

Even among ethnic groups, there were stark differences between the numbers of native- and foreign-born workers who found jobs between June last year and the same month this year.

All of the 392,000 jobs gained by the US Hispanic population went to immigrants, the report says.

The unemployment rate for foreign-born Hispanics fell from 11 percent in the second quarter of 2009 to 10.1 percent in the same period this year. Among US-born Latinos, it went up during the same period, from 12.9 percent to 14 percent.

The same dividing line between job gains and losses among native- and foreign-born was also seen in the non-Hispanic white population and among black Americans.

Non-Hispanic whites lost 986,000 jobs from the second quarter of 2009 to the same period this year, and all of the losses affected native-born whites, whose unemployment rate rose from 7.7 percent to eight percent.

Immigrant whites, on the other hand, gained 214,000 jobs, pushing their unemployment rate down from seven percent to 6.3 percent.

Employment for US-born blacks fell by 142,000 in the first year of the recovery, pushing their unemployment rate up from 15.4 percent to more than 16 percent.

Unemployment fell from 11.4 percent to 10.7 percent among foreign-born blacks, meanwhile, as they gained 81,000 jobs.

The only group in which native-born workers outperformed immigrants in the jobs market was Asian-Americans.

US-born Asians gained 208,000 jobs in the 12 months since June 2009, while Asian immigrants lost 102,000 jobs in the same period.


Analysts see enterprise, consumer push for Microsoft

Friday, October 29th, 2010 | Finance News

BANGALORE (Reuters) – Analysts cheered Microsoft Corp's (MSFT.O) quarterly results on Friday, a day after the company squarely beat Wall Street expectations, and said the company should continue to gain as a new cycle of PC enterprise spending rolls in.

At least four brokerages raised their price target on the stock on expectations that the company would reap from enterprise adoption of Windows 7 and its latest suite of Office products.

"Strong fiscal first-quarter results across metrics in a seasonally soft quarter are emblematic that Microsoft is finally feeling the positive impact of the enterprise upgrade cycle. In our view this will be a multi-year tailwind," UBS analyst Brent Thill said in a note to clients.

In the first quarter, Microsoft's Office unit was the biggest engine, contributing $3.4 billion to profit, while the Windows unit contributed $3.3 billion.

BofA Merrill Lynch said it expects to see continued strength in the Microsoft Business Division (MBD) unit, which produces the Office suite of products, for another three to four quarters, given the pattern in the last two cycles. The company launched Office 2010 in June.

The analysts added that the upcoming Xbox Kinect extension and Windows Phone 7 should boost sales and make up for the lack of a formidable tablet from its stable, going into the holiday season.

Microsoft, whose operating system runs on more than 90 percent of the world's personal computers, has not been able to match growth rates from its hey-day 1990s. Its stock is down 20 percent from 10 years ago.

Microsoft shares have underperformed due to macro concerns, impact from Apple's iPad, and sustainability of growth in fiscal 2011, BofA Merrill analyst Kash Rangan said.

"However, Windows 7 corporate PC refresh and Office 2010 alongside Win 7 tablets in 2011 continue to be catalysts and offer levers that could offset negative impact from iPad if any," he added.

The company's stock trades at price to earnings multiple of 10.8 as opposed to rival Apple's P/E ratio of 15.9, according to Starmine data.

The stock was up 2 percent at $26.77 in midday trading on Nasdaq. It touched a high of $27.20 earlier in the day.

(Reporting by Jennifer Robin Raj and Himank Sharma in Bangalore; Editing by Vyas Mohan and Maju Samuel)