On the third trading day of the week, crude futures have now rallied above $45 per barrel while the Dow Jones and S&P 500 futures are modestly lower as the earnings reports of several tech giants weigh down the indices. In this article, we take a closer look at the latest financial results of United Technologies Corporation (NYSE:UTX), Baker Hughes Incorporated (NYSE:BHI), Boeing Co (NYSE:BA), Anthem Inc (NYSE:ANTM), and AT&T Inc. (NYSE:T). In addition, we are going to analyze how the smart money is positioned in each stock.
At Insider Monkey, we track almost 800 hedge funds and other institutional investors. Through extensive backtests, we have determined that imitating some of the stocks that these investors are collectively bullish on, can help retail investors generate double digits of alpha per year. The key is to focus on the small-cap picks of these funds, which are usually less followed by the broader market and allow for larger price inefficiencies (see the details here).
United Technologies Corporation Turns in Excellent Quarter
United Technologies Corporation (NYSE:UTX) is 0.5% higher after the industrial giant reported EPS of $1.47 on sales of $13.36 billion, beating estimates by $0.08 and $180 million, respectively. Although sales grew only 0.3% year-over-year, as a strong dollar weighed on United’s business, the company’s EPS might grow faster due to share buybacks. United Technologies announced additional share repurchases worth $3 billion in 2016 beyond the buybacks that will be completed under the company’s previously announced $6 billion program. For the full year, the company expects EPS in the range of $6.30 to $6.60 and plans acquisitions worth between $1 billion and $2 billion. Ken Fisher’s Fisher Asset Management reported holding 8.38 million shares of United Technologies Corporation (NYSE:UTX) in its 13F filing for the end of the first quarter.
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Traders Sell Baker Hughes After Lousy First-Quarter Numbers
The low crude oil prices are having a big effect on Baker Hughes Incorporated (NYSE:BHI)‘s business, as the service giant reported a first quarter loss of $1.58 per share on sales of $2.7 billion, which were $1.24 and $150 million below estimates. Sales dropped 42% year-over-year due to the 41% year-over-year global rig count drop and reduced pricing in most markets. Adjusted EBITDA retreated 76% year-over-year to $108 million. Investors hope Baker Hughes Incorporated (NYSE:BHI)’s numbers get better as crude oil rallies. Jeffrey Ubben’s ValueAct Capital was bullish on the company with a holding of over 23 million shares at the end of 2015. Shares of Baker Hughes opened around 4% in red, but have regained some ground.
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On the next page, we examine the last-quarter results posted by Boeing, Anthem, and AT&T.
Boeing Misses on Bottom Line
Boeing Co (NYSE:BA) reported a mixed first quarter today. Although the company’s sales beat estimates by $1.19 billion with a figure of $22.63 billion, its profit of $1.74 per share missed the consensus estimate by $0.09. Operating margin inched lower by 120 basis points to 7.9%, while deliveries at the company’s commercial airplanes unit declined 4% year-over-year. Management guidance for the full year includes EPS in the range of $8.15 to $8.35, sales between $93 billion and $95 billion, and operating cash flow of around $10 billion. The number of funds from our database that held shares of Boeing Co (NYSE:BA) rose by seven quarter-over-quarter to 42 at the end of 2015.
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Anthem Beats Consensus Estimates
Anthem Inc (NYSE:ANTM) turned in a good first quarter, with EPS of $3.46 on sales of $20.31 billion, exceeding analysts’ expectations by $0.14 and $450 million, respectively. Medical enrollment at the insurer rose by 1 million members quarter-over-quarter to 39.6 million at the end of March. For the full 2016, the company expects medical enrollment to grow by 700,000 to 900,000 members and anticipated full-year GAAP EPS above $9.65 and adjusted EPS higher than $10.80 per share. A total of 52 funds that Insider Monkey tracks owned shares of Anthem Inc (NYSE:ANTM) at the end of 2015.
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AT&T Posts Better-than-Expected Earnings
AT&T Inc. (NYSE:T) earned $0.72 per share on sales of $40.5 billion in the first quarter, beating the EPS consensus estimate by $0.03 and meeting sales expectations. The revenue jumped 24.3% year-over-year, largely due to the company’s DirecTV acquisition. North American wireless net adds amounted to 2.3 million for the quarter, while branded postpaid and prepaid phone net adds stood at 712,000. Warren Buffett’s Berkshire Hathaway was one of the top shareholders of AT&T Inc. (NYSE:T) at the end of 2015.
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