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Saturday May 25, 2024

Finances

Finances
 

Oracle Reports Quarterly Earnings

Oracle Corporation (ORCL) released its latest quarterly earnings report on Monday, March 11. The multinational computer technology company’s stock rose by almost 12% after the release of the report.

The company posted net revenue of $13.28 billion for the quarter. This was up 7% from $12.40 billion reported in the same quarter last year but fell short of analysts’ expectations of $13.30 billion.

"Large new cloud infrastructure contracts signed in Q3 drove Oracle's total Remaining Performance Obligations up 29% to over $80 billion—an all-time record,” said Oracle CEO, Safra Catz. “We expect to continue receiving large contracts reserving cloud infrastructure capacity because the demand for our Gen2 AI infrastructure substantially exceeds supply—despite the fact we are opening new and expanding existing cloud datacenters very, very rapidly.”

Oracle reported third-quarter net income of $2.40 billion or $0.85 per adjusted share. Last year at this time, the company reported net income of $1.90 billion or $0.68 per adjusted share.

The company’s cloud services and license support segment revenues were up 12% to $10.0 billion in the quarter. Cloud license and on-premise license segment revenues were down 3% to $1.3 billion. Oracle’s third-quarter cloud infrastructure revenue climbed 49% to $1.8 billion. Oracle’s board of directors declared a quarterly cash dividend of $0.40 per share of common stock. The cash dividend will be due to the stockholder of record on April 10, 2024, with an anticipated payment date of April 24, 2024.

Oracle Corporation (ORCL) shares closed at $125.54, up 12% for the week

Dollar Tree’s Earnings Fall Short


Dollar Tree, Inc. (DLTR) reported its fourth quarter and full year earnings on Wednesday, March 13. The discount retailer’s stock fell by more than 13% after missing sales and profit expectations.

Revenue reached $8.64 billion during the quarter. This was up 12% from $7.72 billion in net sales last year at this time but fell short of analysts’ estimates of $8.67 billion. Revenue for the full year came in at $30.60 billion, up 8% from net sales of $28.33 billion last year.

“We finished the year strong, with fourth quarter results reflecting positive traffic trends, market share gains, and adjusted margin improvement across both segments,” said Dollar Tree CEO, Rick Dreiling. “While we are still in the early stages of our transformation journey, I am proud of what our team accomplished in 2023 and see a long runway of growth ahead of us. As we look forward in 2024, we are accelerating our multi-price rollout at Dollar Tree and taking decisive action to improve profitability and unlock value at Family Dollar.”

The company posted a net loss of $1.71 billion or $7.85 per adjusted share. This was down from net income of $452.2 million or $2.04 per adjusted share during the same quarter last year. For the full year, Dollar Tree reported net losses of $998.4 million.

Dollar Tree opened 219 new stores during the quarter and ended the quarter operating a total of 16,774 stores throughout North America. The company expanded the sale of its multi-price products, which are products priced between $3 to $5, to approximately 5,000 Dollar Tree stores. Dollar Tree announced it would be closing approximately 600 Family Dollar stores in the first half of fiscal 2024 with several hundred more to close throughout the next several years. The store closures were a result of Dollar Tree’s latest comprehensive store portfolio optimization review. For the first quarter of fiscal 2024, the company anticipates net sales in the range of $7.6 billion to $7.9 billion and full year net sales between $31.0 billion and $32.0 billion.

Dollar Tree, Inc. (DLTR) shares ended the week at $127.42, down 14% for the week.

Kohl’s Quarterly Report


Kohl’s Corporation (KSS) reported its fourth quarter and full year earnings results on Tuesday, March 12. The department store chain reported decreased profits and sales leading to an initial drop in its shares before rising by 2.6%.

The company reported net sales of $5.71 billion for the quarter. This was down about 1% from $5.78 billion this time last year. Net sales for the full year came in at $16.59 billion, down 3% from net sales of $17.16 billion the year prior.

“2023 represented an important year for Kohl’s.” said Kohl’s CEO, Tom Kingsbury. “We enhanced our store experience, expanded our partnership with Sephora, and invested in underpenetrated categories. We also simplified our value strategies and implemented new inventory management processes. The early success of our strategies is evident. Our store business had its best comparable sales performance since 2010, Sephora at Kohl’s continued to drive meaningful beauty sales growth, and we managed inventory down 10% at year end.”

The company posted net income of $186 million or $1.67 per share. This is up from net losses of $273 million or $2.49 per share during the same quarter last year. Net income for the full year was $317 million, up from net losses of $19 million last year.

The Wisconsin-based department store chain reported a decrease in its comparable sales of 4.3% year-over-year. Fourth-quarter gross margins increased by 937 basis points compared to the year prior, attributed to reduced clearance markdowns and lower freight and digital-related cost of shipping. Kohl’s board of directors announced a quarterly cash dividend for common stock of $0.50 per share, payable on April 3, 2024, to shareholders of record on March 20, 2024. For fiscal 2024, Kohl’s expects comparable sales to increase 0% to 2% and diluted earnings per share in the range of $2.10 to $2.70.

Kohl’s Corporation (KSS) shares ended the week at $24.81, down 8% for the week.

The Dow started the week of 3/11 at 38,667 and closed at 38,715 on 3/15. The S&P 500 started the week at 5,112 and closed at 5,117. The NASDAQ opened the week at 16,053 and closed at 15,973.
 

Treasury Yields Trend Up

U.S. Treasury yields rose towards the end of the week following the release of higher-than-expected monthly producer prices. Yields continued the upward trend on Friday as investors wait for the Federal Reserve meeting next week.

On Thursday, the Bureau of Labor Statistics released February’s producer price index (PPI) which indicated a rise in inflation. The February PPI grew 0.6%, exceeding economists’ estimates of a 0.3% growth. Year-over-year, the increase in wholesale prices advanced by 1.6%, the largest increase since September 2023.

“The February PPI report was a mixed bag,” said chief economist at PNC Financial Services, Gus Faucher. “Inflationary pressures remain in the pipeline, but with supply and demand continuing to normalize after the pandemic, inflation continues to gradually slow.”

The benchmark 10-year Treasury note yield opened the week of March 11 at 4.08% and traded as high as 4.32% on Friday. The 30-year Treasury bond opened the week at 4.26% and traded as high as 4.46% on Friday.

On Thursday, the U.S. Department of Labor reported that initial claims for unemployment decreased by 1,000 to 209,000 for the week ended March 9, below analysts’ expectations of 218,000. Continuing unemployment claims increased by 17,000 to 1.81 million.

“The revised data for continued claims are consistent with a job market that is showing some signs of loosening but is still relatively strong,” said lead U.S economist at Oxford Economics, Nancy Vanden Houten.

The 10-year Treasury note yield finished the week of 3/11 at 4.32%, while the 30-year Treasury note yield finished the week at 4.43%.
 

Mortgage Rates Continue to Drop

Freddie Mac released its latest Primary Mortgage Market Survey on Thursday, March 14. The survey showed mortgage rates fell to the lowest level in five weeks.

This week, the 30-year fixed rate mortgage averaged 6.74%, down from last week’s average of 6.88%. Last year at this time, the 30-year fixed rate mortgage averaged 6.60%.

The 15-year fixed rate mortgage averaged 6.16% this week, down from last week’s 6.22%. During the same week last year, the 15-year fixed rate mortgage averaged 5.90%.

“The 30-year fixed-rate mortgage decreased again this week, with declines totaling almost a quarter of a percent in two weeks’ time,” said Freddie Mac’s Chief Economist, Sam Khater. “Despite the recent dip, mortgage rates remain high as the market contends with the pressure of sticky inflation. In this environment, there is a good possibility that rates will stay higher for a longer period of time.”

Based on published national averages, the savings rate was 0.46% as of 2/20. The one-year CD averaged 1.83%.

Editor’s Note: The publicly available financial information is offered as a helpful and informative service to our friends. This article is not an endorsement of any company, product or service.

Published March 15, 2024
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