Elite Inside Trader

Nothing like great earnings reports to sweep yesterday’s S&P outlook downgrade under the rug.  After the bell today IBM (IBM), Intel (INTC), and VMWare (VMW) provided a pop to technology as all three beat expectations.  Earnings not only looked great for the quarter, but guidance going forward was positive as well.

Shhhhh!  A Weaker US Dollar Helped These Numbers

Intel (INTC) Revenue for the first quarter  rose 25% to $12.9 billion, on a non-GAAP basis, with EPS of 59 cents. Analysts had been expecting $11.6 billion in revenue and 46 cents EPS.

For this quarter (Q2) Intel forecast revenue of $12.4 billion to $13.4 billion, well ahead of the average $11.9 billion estimate.  EPS is expected to fall between &0.32 to $0.35, well ahead of the average $0.28 estimate.

Intel is up over 5% right now in after-hours, we do like this stock as an income play.

IBM (IBM) Net income rose 10 percent to $2.86 billion, or $2.31 per share. Last year, IBM earned $2.6 billion, or $1.97 per share.

Big Blue continues to perform well; despite the fact that many investors feel the company is fully valued.  We’re not buyers at this level.  As we write this, we noticed the stock spiked higher on the earnings news afterhours, but is now trading lower.

VMWare (VMW) For the first quarter they reported earnings of $125.8 million, or 29 cents per share, compared with $78.4 million, or 19 cents per share, a year ago.

Excluding one-time items, VMWare earned 48 cents per share. Analysts were expecting 42 cents per share, on average.  While we like this stock, we prefer to play it through EMC (EMC), which owns 80% of VMWare’s outstanding shares.

Yahoo (YHOO) Yahoo beat earnings by a penny, but who cares.  The more time that goes on with the stock under $20, the more idiotic the rejection of Microsoft’s (MSFT) $31, bid to buy the company back in 2008 becomes. That offer was a 62% premium over Yahoo’s (YHOO) valuation at the time.

Disclosure: Author, Kevin D. Monaghan, Senior Partner at Elite Investment Group, is long AAPL

IMPORTANT NOTICE: "Any information we give you is not our recommendation or advice to take (or not to take) any particular course of action in relation to your investments. You should take your own independent advice based on your specific circumstances."

Tags: AAPL, Apple, Big Blue, Earnings, Earnings Alert, EMC, IBM, INTC, Intel, Investing, Microsoft, MSFT, Old Tech, Shares, Stocks, VMW, VMWare, Yahoo, YHOO