Bank of America Corp (BAC), And The Five Biggest Earnings Disappointments for the Dow (.DJI)

Page 1 of 2

Most of the 30 stocks in the Dow Jones Industrial Average 2 Minute (INDEXDJX:.DJI) have reported their first-quarter earnings results. Overall, the positive surprises have outnumbered the negative ones, with the general assessment of the season having been favorable.

Dow Jones Industrial Average 2 Minute (INDEXDJX:.DJI)

But a few stocks haven’t been able to match the expectations that investors put on them. Let’s take a closer look at five companies that missed their earnings expectations.

Bank of America Corp (NYSE:BAC)

Any time a company’s profit quadruples from year-ago levels, you’d think it’d be cause for celebration. But for Bank of America Corp (NYSE:BAC), it wasn’t quite enough, as the bank missed estimates by $0.02 per share.

Yet on the whole, there was a lot of good news for B of A. First-lien mortgage activity was up sharply, its global investment banking division performed well, and it has managed to put some big litigation risks as well as nonperforming assets behind it. With the foresight to give up on boosting its dividend in favor of getting itself even stronger from a capital standpoint, B of A’s disappointment seems like a short-term issue.

Caterpillar Inc. (NYSE:CAT)

Caterpillar served up a double-whammy for investors, missing earnings estimates by $0.07 per share and cutting its full-year 2013 guidance by a full $1 per share. The big problem for the company was its mining equipment business, which has struggled in light of slowing conditions in China and elsewhere around the world.

If anything, Caterpillar Inc. (NYSE:CAT)’s problems in mining are likely to get worse before they get better, as the big plunge in gold prices came in April after the first quarter had ended. Unless gold rebounds very quickly, expect further trouble from Caterpillar Inc. (NYSE:CAT) in the second quarter and beyond.

International Business Machines Corp. (NYSE:IBM)

International Business Machines Corp. (NYSE:IBM) sent the Dow Jones Industrial Average 2 Minute (INDEXDJX:.DJI) plunging on the day after it reported earnings, missing expectations by a nickel per share despite posting a 3% increase in net income for the quarter. Sales fell 5% from the year-ago quarter, as orders from the U.S. and Chinese governments were particularly weak.

The question looking forward is whether International Business Machines Corp. (NYSE:IBM)’s claim that some large orders that didn’t close in time to get included in the first-quarter results end up coming in during the second quarter. With the company still projecting solid earnings for the year, International Business Machines Corp. (NYSE:IBM)’s disappointment seems overblown at this point, although it’s critical for the company to execute better on its strategy in the highly competitive space.

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

Shopaholics Rejoice: The 12 Biggest Malls in the World

Fright Night: 10 Horror Movies Based on True Stories

Mach Mania: The 10 Fastest Jets in the World

Military Heavyweights: The 10 Countries with the Most Tanks

All In: The 7 Richest Poker Players in the World

Abracadabra: The 10 Best Magicians in the World

The 10 Richest Asian Countries in the World in 2014

Eyes in the Sky: 10 Things You Need to Know About Drones

Rising Stars: The 6 Best Silicon Valley Startups

Military Muscle: The 5 Most Advanced Armies in South America

All that Glitters: The 7 Most Luxurious Jewelry Brands in the World

5 Things You Didn’t Know About ISIS but Should

Empowering Your Money: The 5 Best Energy Stocks to Invest In

The 11 Best Android Apps You Can’t Get on iOS

The 10 Most Important International Conflicts in 2014

Mood Enhancers: The 20 Most Uplifting Songs of all Time

Lover Beware: The 8 Countries that Cheat the Most

Breath of Fresh Air: The 25 Countries with the Best Air Quality on the Planet

Singles Beware: The 8 Worst Mistakes Made on First Dates

Healthy and Happy: The 10 Countries with Lowest Healthcare Costs

The 6 Best Company Team Building Activities to Build Workplace Camaraderie

Ships Ahoy: The 10 Busiest Shipping Ports in the World

10 Productivity Tips to Save You Time and Help You Do More With Less

Grab a Bite: The Most Popular Fast Food Restaurants in America

Friday Night Thirst: The 10 Most Popular Cocktails in the World

The 6 Greatest Unsolved Mysteries We May Never Figure Out

7 Useless Products You Never Should’ve Bought

The 5 Reasons Why You’re Single and Miserable

The 7 Most Addictive Foods in the World We Can’t Stop Eating (Even Though We Should)

5 Amazing Places You Can Swim with Dolphins

The Top 7 Most Livable Countries In The World

The 10 Most Expensive Baseball Cards Ever Pulled From A Pack

The 5 Easiest Second Languages to Learn for English Speakers

Silver Spoon: The 6 Richest Families in the World

The 20 Countries with the Largest Prison Populations in the World

The Top 10 Richest Actors in the World

The 10 Best Airline Stocks to Invest In Before They Fly Too High

Burger Kings: The 10 Most Expensive Burgers in the World

The 10 Most Ethnically Diverse Countries in the World

The 10 Most Exclusive Credit Cards in the World

The 10 Most Expensive Cruise Ships in the World

The 10 Fastest Supercomputers in the World

The 10 Best Countries for Doing Business 2015

6 Most Expensive Fruits In The World

10 Worst Airlines in the World

The 10 Biggest Tax Havens in the World to Stash Your Money

The 15 Most Murderous Countries in the World

10 Largest Colleges in the World: Bigger Isn’t Always Better

Comedians in Cars Getting Coffee: The 6 Comedians Seinfeld Needs to Interview

Easy Money: The 10 Most Successful Investors in the World Today

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!