Today's weak and horrible jobs numbers did not wreck the markets because they were actually a tad less horrible than yesterday's whisper numbers. It is amazing when 6.5% unemployment and -240,000 jobs to make 1.2 million jobs lost this year is GOOD NEWS.
American International Group (NYSE: AIG) rose on multiple reports that federal officials are looking at ways to ease financial pressure on the insurance giant. Shares were up over 11% at $2.08 right before the close.
NVIDIA Corporation (NASDAQ: NVDA) rose after its earnings came in well above plan considering that it had set the bar so low. Despite a revenue warning, value buyers had this graphics card giant trading up 13% at $8.61 right before the close.
QUALCOMM (NASDAQ: QCOM) was a surprise gainer today after trading down this morning. The CDMA cellular chip and wireless standard giant missed earnings and guided estimates down on weakening cell phone sales trends. Shares were up almost 8% at $35.57 right at the close.
Pfizer Inc. (NYSE: PFE) was under more pressure this morning, but rose throughout the trading day. Goldman Sachs downgraded this stock today down to a SELL rating, yet shares were uo almost 3% at $16.84 right before the close of the day.
Wells Fargo & Co. (NYSE: WFC) was actually flirting with positive territory at 3:59. Considering it sold $11 billion in stock at $27.00, it is amazing that it was only down 0.1% at $28.72 in the seconds before that unofficial closing level.
It's not that the bottom-line numbers were wholly bad. Net profit rose 16% to roughly $1.1 billion. Earnings per diluted share on an adjusted basis increased 17% to $0.63. According this news source, that figure beat estimates by three pennies. That's all well and good, but that news source also states that Qualcomm is guiding below consensus. Not surprising, certainly, given what the markets are going through. But it still puts a damper on the stock's near-term potential, in my opinion. Plus, free cash flow was down 13% during the quarter, and it was flat for the twelve-month period.
Except for certain companies like Microsoft Corporation (NASDAQ: MSFT), I'm not really interested in playing the tech sector. If you had purchased Qualcomm near its 52-week low of $30.87, I'd be a seller into today's strength. No, I certainly can't predict the movement of stock prices, but I can tell you that I think Qualcomm could easily pull back from today's rally. The recession is going to worsen, and I don't think we've reached the point where the market will begin to discount better days. In fact, we're probably far off from that point. The rally that is going on in the markets as I write this (and by the time this gets published, it could be gone for all I know) feels like a dead-cat bounce. That wouldn't be good for Qualcomm's stock, I'd imagine. So, kudos to management for beating Q4 expectations. But I won't be rewarding you by buying your stock. Sorry!
Disclosure: I don't own any company mentioned; positions can change at any time.
Minyanville contributor Sean Udall dares to share the kind of keen insight and actionable information you won't find in any prospectus. For more original thought, visit www.minyanville.com.
I've taken a leg in the Ultra QQQ ProShares (AMEX: QLD). The market has popped 2% off lows, the question is will it pop the full 7%?
I'm seeing a few positive divergences and the percentage of stocks below the 50 day moving average is well below the 2002 levels. I haven't looked at the percentage of stocks below the 200 day, but I'm sure the reading should be equally distressed.
I know people are pricing in earnings per share Armageddon in tech land -- so the question is, what happens to many of these stocks if it's really just sort of "punk" and not a total cataclysmic drop in revenue guidance.
No matter how good Qualcomm (NASDAQ: QCOM)'s earnings have been over the last two years, its stock has been capped to some extent by its long legal battle with its largest customer, Nokia (NYSE: NOK). The dispute is over now, news which is probably better for Qualcomm than Nokia. The legal threat hanging over the cell phone chip maker firm is gone.
According toThe Wall Street Journal, "Under the settlement, Nokia will withdraw that complaint as well as other litigation. Besides getting licenses to Qualcomm patents, Nokia said it will assign ownership of a number of its patents to Qualcomm. The pact not only covers patents used in current cellphone networks but also emerging technologies that could succeed them -- including WiMax and LTE, which stands for long-term evolution."
The news sent Qualcomm's stock up over 18%.
Nokia had disputed the fees Qualcomm charged for its chips and the license fees for its technology. Qualcomm can now get substantial payments from its former nemesis. If Qualcomm had lost its battle, its long-term income could have been cut sharply. Nokia is getting access to patents, but it will still be making payments to the chip company.
The trouble has kept Qualcomm's shares from trading above the $52 level that they hit in mid-2006. Investors can expect that the ceiling on the stock will now be gone.
Douglas A. McIntyre is an editor at 247wallst.com.
"Yes, the market is declining. And, yes, it is often scary to buy during such market periods. Nevertheless, there's an adage that 'the best time to invest was yesterday; the next best time is today'.
"Indeed, countless studies have shown that the best thing any investor can do is invest early and often. That is the best way to maximize the power of time, and time will have the greatest bearing on your investment results.
"Thus, investors need to be willing to buy even when it is difficult to do so, or should I so especially when it is difficult to do so. The reason is that we usually are reluctant to buy stocks during market declines. Yet, if you think about it, declining markets should be precisely the time we buy since stocks are cheaper.
"The stock has demonstrated impressive price performance throughout the market volatility in recent months, rising to its highest level in a year above $50 before pulling back.
Again this week, in a list of earnings expectations for some prominent companies in a variety of sectors, we see an apparent optimism. That is, analysts are anticipating more earnings growth than earnings declines.
Analysts surveyed by Thomson Financial expect the following companies to report a rise in earnings when compared to the same period of the previous year.
Qualcomm (NASDAQ: QCOM) closed at $48.33 Friday. QCOM makes chips for handsets and licenses technology to handset makers. QCOM is expected to report Q3 EPS on July 23. QCOM August option implied volatility of 44 is above its 26-week average of 38 according to Track Data, suggesting larger price movement.
Qualcomm (NASDAQ: QCOM) designs, develops, manufactures and markets digital wireless telecommunications products and services based primarily on its Code Division Multiple Access (CDMA) technology. The firm supplies integrated circuits and system software for voice and data communications, multimedia devices and global positioning products. It also licenses CDMA semiconductor technology and software to more than 100 other equipment and cell phone makers. The Qualcomm Ventures unit invests in wireless communications and Internet startups. Major competitors include Nokia (NYSE: NOK) and Texas Instruments (NYSE: TXN).
The company pleased investors last week, when it guided fiscal Q3 EPS to 54-55 cents (50-52 cents prior, 52 cent consensus) and Q3 revenues to points slightly above $2.7 billion ($2.5-$2.7B prior, $2.61B consensus). Management also guided FY08 EPS to $2.09-$2.13 ($2.04-$2.09 prior, $2.11 consensus). The updated guidance reflected greater than expected demand for Qualcomm's 1xEV-DO and HSPA chipsets, as well as revenues from advanced 3G network upgrades. Jefferies subsequently reiterated its "buy" rating on the shares and boosted its price target to $54.
"In 1999, Qualcomm (NASDAQ: QCOM) went from less than $4 to over $92; but the party came to a screeching halt over the next three years," recalls Chuck Carlson, an expert on stocks that offer dividend reinvestment plans.
In The DRIP Investor, he explains, "The stock has been stuck in a trading range for the last four years. But that looks like it is about to end, as it recently moved to a new 52-week high and is setting its sites on its 2006 high of $53."
"Strong earnings and greater visibility on some litigation matters should pave the way for solid gains in the second half of 2008. Technology stocks should remain among the market's leading sectors, and Qualcomm offers an excellent play in the group.
"Qualcomm generates 90% of its revenue from cell-phone chipsets and license royalties paid by users of its intellectual property. Qualcomm's chips are used in mobile phones and wireless infrastructures around the globe.
"Growth here should remain strong as networks convert to third-generation technology and emerging markets expand and upgrade their infrastructure.
"Uncertainty about the legal disputes has weighed on Qualcomm (NASDAQ: QCOM)," says Richard Moroney, who rates the stock a long-term buy. The editor of Dow Theory Forecasts explains, "Though the court case may distract investors, Qualcomm's long-term fundamentals appear solid." Here's his bullish outlook.
"The company is embroiled in disputes over royalty fees paid for use of its patents, particularly by one of its largest customers, Nokia. In March, the combatants agreed to consolidate a host of lawsuits into one case to be heard later this year and likely to be decided by year's end.
"Barring a disastrous court loss, which seems unlikely, Qualcomm shares should benefit. Any resolution will reduce uncertainty. By the end of this year, Qualcomm should be able to jettison some of the baggage holding back its stock.
"While the U.S. economic slowdown has sparked fears of a decline in demand for microchips, Qualcomm should benefit as cell-phone users worldwide transition to third-generation technology, which allows for faster downloading of video, music and other data.
Today's weak and horrible jobs numbers did not wreck the markets because they were actually a tad less horrible than yesterday's whisper numbers. It is amazing when 6.5% unemployment and -240,000 jobs to make 1.2 million jobs lost this year is GOOD NEWS.
Minyanville contributor Sean Udall dares to share the kind of keen insight and actionable information you won't find in any prospectus. For more original thought, visit 
Qualcomm
Qualcomm
.gif){kind=logo}
Here are some highlights from this past week's 
Stock picks and pans for troubled times: RIMM, ED, ISRG, GLW, LEA, SLB, GOOG ...
Is Berkshire Hathaway better than S&P Index?
Closing Bell: Torch Passing on a Friday Rally
