The Long Term Investor

finally got a chance to sit down and look at the markets and my account. I was STRONGLY in the green today. PLUS....a solid beat on the SP500 by 0.76%.

A very nice day in the .....market....neighborhood.

 

HERE we go.

Microsoft posts big earnings beat and gives optimistic revenue forecast

https://www.cnbc.com/2021/07/27/microsoft-msft-earnings-q4-2021.html

(BOLD is my opinion OR what I consider important content)

"Key Points

• Microsoft surpassed expectations on the top and bottom lines with stronger-than-expected Azure revenue growth, but supply constraints cut into Windows revenue from device makers.
• The company’s revenue guidance beat expectations as well.

Microsoft shares initially fell before rebounding and rose as much as 1% in extended trading on Tuesday after the software and hardware company issued fiscal fourth-quarter earnings and quarterly revenue guidance that exceeded expectations.

Here’s how the company did:

• Earnings: $2.17 per share, adjusted, vs. $1.92 per share as expected by analysts, according to Refinitiv.
• Revenue: $46.15 billion, vs. $44.24 billion as expected by analysts, according to Refinitiv.

Revenue rose 21% year over year in the quarter, which ended June 30, according to a statement. Revenue had increased by 19% in the previous quarter. Net income increased by 47%.

With respect to guidance, Microsoft called for $14.5 billion to 14.75 billion in fiscal first-quarter revenue from its Productivity and Business Processes segment, higher than the $14.07 billion StreetAccount Estimate. For the Intelligent Cloud segment, the company sees $16.4 billion to $16.65 billion in revenue, higher than the $15.71 billion consensus. And the More Personal Computing segment guidance was $12.4 billion to $12.8 billion in revenue, with the middle of the range coming in just short of the StreetAccount consensus of $12.67 billion.

In the fiscal fourth quarter, Microsoft’s Intelligent Cloud segment, which includes the Azure public cloud, Windows Server, SQL Server and GitHub, produced $17.38 billion in revenue, up 30% year over year. Analysts polled by StreetAccount had expected $16.33 billion in revenue.

Revenue from Azure, which competes with Amazon Web Services, grew 51% in the quarter, or 45% in constant currency. Analysts had been expecting 45.3% revenue growth from Azure, according to a CNBC consensus, while the StreetAccount consensus was 42%. In the prior quarter, Azure revenue grew 50%. Microsoft does not disclose Azure revenue in dollars.

In the fiscal first quarter, Azure revenue growth in constant currency should remain relatively stable on a sequential basis, Microsoft’s finance chief Amy Hood said on the company’s earnings call.

The Productivity and Business Processes unit, which contains Office productivity software along with LinkedIn and Dynamics, contributed $14.69 billion in revenue, up 25% and above the StreetAccount consensus of $13.93 billion.

Microsoft’s seat growth for commercial Office 365 subscriptions accelerated to 17% from 15%, with the company citing higher revenue per user and better results from products designed for small businesses and front-line workers. The Teams chat and calling app in Office 365 now has 250 million monthly active users, Microsoft said. The premium E5 tier now accounts for 8% of all commercial Office 365 subscriptions, Hood said.

Microsoft’s More Personal Computing segment, which features Windows, as well as devices, gaming and search advertising, generated $14.09 billion in revenue. That’s up 9% and more than the $13.74 billion StreetAccount consensus.

Technology industry research company Gartner estimated that PC shipments grew 4.6% in the quarter. Microsoft’s revenue from device makers for Windows licenses in the quarter fell 3%, with license revenue associated with consumer PCs decelerating to a decline of 4% from 44% growth in the prior quarter. The company pointed to supply constraints, which PC makers Dell and HP have flagged in recent months.

Sales of Microsoft-branded Surface PCs dropped 20%, worse than the decline in the mid-teens range that Microsoft had called for in April, because of supply challenges.

The coronavirus pandemic benefited Microsoft results in some ways and hurt in others. The company’s revenue from Xbox content and services, including sales of video games, declined 4%, with the metric comparing unfavorably against 65% growth in the year-ago quarter.

Microsoft’s server products category, which features the Windows Server operating system and SQL Server database software, delivered 16% revenue growth, up from 3% in the prior quarter thanks to an easy comparison against the year-ago quarter because of transactional weakness at the time. Those conditions also arose because of Covid.

Search advertising revenue grew 53% as the advertising market rebounded. That also benefited the LinkedIn business, which showed 46% growth. The Marketing Solutions business tied to advertising grew 97%, with more than $1 billion in quarterly revenue, Microsoft CEO Satya Nadella said on the call. LinkedIn overall now generates $10 billion in annual revenue, he said.

During the fiscal fourth quarter, Microsoft announced its intent to acquire speech-recognition company Nuance Communications for $19 billion, including debt. It also introduced Windows 11, a new version of its desktop operating system, although sales of licenses to device makers will be deferred.

The company’s board voted to make Nadella its chair, and Microsoft’s top individual shareholder, co-founder Bill Gates, announced that he’s splitting up with his wife, Melinda French, who also once worked at Microsoft.

Notwithstanding the after-hours move, Microsoft shares are up about 29% since the start of 2021, while the S&P 500 index has risen almost 17% over the same period."

MY COMMENT

I dont care what anyone thinks.....this is a BLOW OUT earnings beat by Microsoft. A perfect momentum driver for the markets this week.

 

Next:

Alphabet reports better-than-expected quarterly profit and revenue

https://www.cnbc.com/2021/10/26/alphabet-goog-earnings-q3-2021.html

(BOLD is my opinion OR what I consider important content)

"Key Points

• Alphabet topped analysts expectations on the top and bottom lines.
• CFO Ruth Porat said Apple’s privacy changes had a “modest impact on YouTube revenues.”
• The company’s shares were little changed after the results.

Alphabet beat on the top and bottom lines, but the stock didn’t move — Four experts on the stock
Alphabet reported profit and earnings for the third quarter that topped analysts’ estimates. The company’s shares were little changed after the report.

Here’s what Alphabet reported versus what Wall Street expected:

• Earnings per share (EPS): $27.99 per share vs $23.48 per share, according to Refinitiv estimates.
• Revenue: $65.12 billion vs. $63.34 billion, according to Refinitiv estimates.
• YouTube advertising revenue: $7.20 billionvs. $7.4 billion expected.
• Google Cloud revenue: $4.99 billion vs. $5.07 billion expected.
• Traffic acquisition costs (TAC): $11.50 vs.$11.16 billion expected.

Google’s advertising revenue rose 43% to $53.13 billion, up from $37.1 billion the same time last year and slightly higher than the prior quarter. YouTube ads rose to $7.21 billion, up from $5.04 billion a year ago.

Google appears to be managing through privacy changes that Apple made to iOS 14 earlier this year. Snap and Facebook both cited the change, which allows consumers to opt out of targeted ads on apps, as the main reason for business disruption during the period. Google is more protected than those companies because it owns the Android operating system.

Ruth Porat, Alphabet’s finance chief, said on the call with analysts that the new privacy features had a “modest impact on YouTube revenues.” She added that “focusing on privacy has been core to what we’ve been doing consistently.”

The stock is up 58% this year, more than double the gains in the S&P 500, as investors bet on Google’s ability to pick up business as the economy reopens and to withstand potential regulatory changes.

Philipp Schindler, Google’s chief business officer, said retail was the largest contributor to year-over-year ad growth. Media and finance spending was also significant.

“We continue to see a lot of unevenness,” Schindler said on the call, referring to the pandemic recovery in various countries. “It’s clear that uncertainty is the new normal.”

Revenue in Google’s cloud division climbed 45% to $4.99 billion, while operating loss narrowed to $644 million from $1.21 billion. Alphabet has been investing heavily in the unit, which is led by former Oracle executive Thomas Kurian, in an effort to catch up to Amazon Web Service and Microsoft Azure.

Revenue in the Other Bets segment, which includes the self-driving car company Waymo, rose slightly to $182 million from $178 million. Losses widened to $1.29 billion from $1.1 billion a year earlier.

Alphabet reported a gain on investments of $188 million in the quarter, up from a gain of $26 million a year earlier. The company’s investment arms, which bet on start-ups at various stages, benefited from the IPOs of cloud software developer Freshworks and restaurant-tech vendor Toast.

Porat said the company added 6,000 employees in the third quarter and expects “robust” headcount growth in the fourth quarter."

MY COMMENT

Again.....I dont care about how anyone tries to SPIN this.....these are great earnings by a MATURE TECH MONSTER. This company and all the other BIG tech companies......except for Facebook......are in that sweet spot in their business lives where they can ride the wave for decades.....if their management does not screw it up.

 

And....finally:

AMD sales rise 54% on strong demand for chips for servers and game consoles

https://www.cnbc.com/2021/10/26/amd-earnings-q3-2021.html

(BOLD is my opinion OR what I consider important content)

"Key Points

• AMD reported third quarter earnings after the bell on Tuesday.
• AMD has benefitted from a surge in electronics sales as its central processors and graphics processors power PCs, servers, and game consoles.
• AMD earnings and revenue beat analyst expectations, and the company issued a strong forecast for the fourth quarter.

AMD reported third-quarter earnings after the bell on Tuesday, with earnings and revenue beating analyst expectations, and a strong forecast for the fourth quarter.

The stock was up as much as 1% in extended trading.

Here’s how the chipmaker did against Refinitiv consensus estimates for the quarter ending Oct. 2:

• EPS: $0.73, adjusted, versus $0.67 expected, up 16% year-over-year.
• Revenue: $4.31 billion, versus $4.12 billion expected, up 54% year-over-year

AMD said it expected $4.5 billion in sales in the fourth quarter, ahead of analyst expectations of about $4.25 billion in sales in the quarter. AMD is forecasting 39% annual growth in the fourth quarter.

AMD is one of the companies that has benefitted the most from the surge in electronics sales over the past 18 months as its central processors and graphics processors power PCs, servers and game consoles. Those sales are logged in AMD’s computing and graphics segment, which reported $2.4 billion in revenue, up 44% year-over-year.

The PC market has slowed from its torrid pace a year ago when people around the world still needed computers to work or learn from home, but AMD said its chips were selling at higher average prices as customers opt for more powerful processors.

AMD reports server chip and console chip sales in its Embedded, Enterprise, and Semi-custom segment. AMD reported $1.9 billion in sales in this important category, up 69% year-over-year driven by Epyc server chips, and higher “semi-custom” sales, which are the semiconductors it sells to game console makers.

AMD is in the process of taking market share in the server market behind its Epyc processors, as giants like Microsoft and Google buy its chips to run their cloud services. AMD CEO Lisa Su said in a statment that data center sales doubled year-over-year and now represents “mid-20s” of overall AMD revenue.

Meanwhile, game consoles, like Sony’s Playstation 5 and new Microsoft Xbox models, remain in high demand and hard to find as they sell out quickly. Likewise, AMD’s graphics and central processors are hard to find in stock in stores.

“Semi-custom revenue grew sequentially and year-over-year as demand for the latest Microsoft and Sony consoles remains very strong,” Su said on a call with analysts on Tuesday. “We expect semi-custom revenue to increase sequentially in the fourth quarter as we further ramp supply to address the ongoing game console demand.”

AMD is a fabless chip company. It designs the technology inside its semiconductors and outsources manufacturing to foundry partners like TSMC and GlobalFoundries. In September, AMD CEO Su said she expects the chip shortage to become less severe in 2022.

AMD continues to keep its costs under control and increase its profitability. It said its gross margin was 48%, up from 44% in the same period last year because customers are buying more expensive processors. It forecast gross margins at 49.5% in the fourth quarter. AMD’s net income for the quarter was $893 million.

Last October, AMD announced its plans to buy Xilinix in a deal worth $35 billion that would give the company more firepower to compete with Intel in the data center chip market. AMD said the deal was still on track to close by the end of 2021 and the company is making “good progress” to securing regulatory approvals.

AMD said it repurchased $750 million in shares during the quarter. AMD stock is up over 30% year to date."

MY COMMENT

BRAVO....well done AMD. A very good omen for Nvidia when they report.

 

So....the earnings are ROLLING IN and making fools of all the "experts" that predicted a BLAH earnings season. They can spin it however they wish but the truth is they were WRONG.....again.

The markets can ignore the truth for a little while....but....not for the long term.

Of course....stock futures are flat and mixed. Just more......PROOF......that all the so called experts and short term traders either dont know anything.....or....they play their little games too manipulate the markets for their little short term trades.......or......BOTH.

The REAL....professionals and experts......all the millions of little retail investors.

Tomorrow....not much going on.......Kraft reports. On Thursday the.......BIG ONE......Amazon.

We are kicking ass......and....taking names.

 

Well....the markets have had a chance to open and settle in this morning......and....all the averages are green at the moment. The Ten year yield is also nicely.....DOWN....back to 1.576%. So.....earnings are good, interest rates are at historic 100 year lows.....as they have been for a long time.

Not much going on today in terms of earnings. Today will be a day for the markets to digest the earnings to date.....especialy the big tech earnings. We will see if the markets are going to respect....or....disrespect the great earnings that we have been seeing.

I have NO ILLUSIONS as to the ability of the markets to ignore and nit-pick earnings.

 

Speaking of earnings.

Q3 earnings are surprising to the upside, but...: Morning Brief

https://finance.yahoo.com/news/surp...ff-the-gloom-but-morning-brief-090859515.html

(BOLD is my opinion OR what I consider important content)

"We’re knee-deep into the third quarter earnings season, and thus far results are mostly defying the implications of ships idling in the Pacific Ocean staked to the brim with goods they can’t deliver — or an outraged public wielding digital pitchforks.

Unless your name is Robinhood (HOOD) (a pox on those mercurial retail traders) — but certainly if you’re the high-flying technology stocks like Alphabet (GOOG), Microsoft (MSFT) and Facebook (FB)— you’re among the lucky group beating Q3 expectations by a mile.

In fact, of the more than 140 S&P 500 companies that have reported earnings thus far, nearly 82% of them have beaten Wall Street’s estimates, according to Refinitiv data. That’s well above the historical average of 66%, the firm notes, even though the ratio of negative pre-announcements to positive ones (0.8) is running well below the long-term average (2.6).


The Q3 earnings scorecard, as of October 26.
Given the worries that foreshadowed the Q3 reporting season, it’s almost enough to make you ask the question: What supply chain crisis?

The struggle to deliver goods and services — and to hire enough bodies to accomplish the task — is certainly writ large. Retailers and consumers alike are getting increasingly antsy about the holiday season, especially with inflation rearing its head — which was enough to hammer stocks in September, one of the most volatile months this year.

Yet, it's undeniable that companies are doing better than expected, and there are at least a couple of salient reasons behind this. So what’s going on?

"The market has rebounded pretty significantly, especially given September's performance in the equity markets," Gargi Chaudhuri, head of iShares investment strategy at BlackRock, told Yahoo Finance on Tuesday. "What we're focusing on more recently is... more of that reflationary theme [playing] out in the market."

So are we free and clear from the inflationary and supply chain worries that were giving investors the vapors only weeks ago?

Well... not entirely.

Over at Deutsche Bank, chief equity strategist Binky Chadha recently crunched the Q3 numbers, and found some noise in otherwise strong results. As it turns out, the stellar performance of big banks was largely attributed to the release of loan-loss reserves that Wall Street thought it needed to cushion the blow of COVID-19.

If you exclude those factors, the headline outperformance of S&P 500 companies in aggregate during Q3 is running at a comparatively tame 8%, well below the current levels over 80%. The median results are even less impressive, checking in at 5.2%.

“At the moment, our team sees earnings on track to being flat to down sequentially by -0.2% to -2% [quarter-over-quarter, seasonally adjusted in Q3], marking the first drop since Q2 2020,” Deutsche Bank economist Jim Reid wrote this week.

Meanwhile, keep an eye on sales growth, which the bank estimates has slowed to a near crawl in Q3: Deutsche thinks margins will drop, squeezed by rising inflation and ancillary costs. And soaring energy prices, which have sparked rising chatter about a 1970s-style oil shock and stagflation, aren’t likely to improve the outlook, either.

“Forward consensus estimates have risen modestly, but mostly due to higher oil prices. Excluding energy, estimates for [the fourth quarter] and 2022 are down slightly,” Reid said.

All told, it means the economy — and corporate America — isn’t out of the woods just yet. Keep one eye on Q3 earnings, but the other on guidance for Q4 and the upcoming calendar year."

MY COMMENT

LOL.....this is one of those articles that takes the POSITIVE and tries to make it a negative. Earnings are great....actually historic. In fact.....82% of reporting companies have BEATEN ESTIMATES.....compared to the historic norm which would be 66%.

I think it is funny.......the focus of the article on the negative....but, but, but......what about.....Blah, blah, blah. "If you exclude".....this or that.....blah, blah, blah. What about the supply chain......that apparently consumers do not care about in the least as they spend historic amounts of money in the economy.....blah, blah, blah.

TYPICAL financial media BS....typical excuses for earnings that are.....as the article WHINES ABOUT....."are defying expectations". Expectations of who? Well all the financial media writers and their so called experts. As usual......the experts and financial media......are WRONG.....and they dont like it.

As a long term investor I take the positive from articles like this......the whining......a sad joke.

 

Continuing with my theme of.....cherry picking....the positive actual data from articles.....I like the information below.

Stock market news live updates: S&P 500 and Dow drift below record levels, Microsoft shares gain after strong earnings

https://finance.yahoo.com/news/stock-market-news-live-updates-october-27-2021-221534323.html

(BOLD is my opinion OR what I consider important content)

"Stocks hovered near record levels on Wednesday as investors eyed a slew of stronger-than-expected earnings results from closely watched technology companies.

The S&P 500 and Dow traded within striking distance of all-time highs. The Nasdaq outperformed, fueled by a jump in technology stocks post-earnings. West Texas intermediate crude oil prices pulled back but remained near their highest level since 2014. Treasury yields dipped across the curve, and the benchmark 10-year yield fell below 1.6%.

Google's parent-company Alphabet (GOOG, GOOGL) edged higher after posting third-quarter revenues and earnings that topped consensus estimates, fueled by a further rise in online advertising spending especially among retailers on Google Search. YouTube and Google Cloud revenue growth, however, slowed compared to the prior quarter. Microsoft (MSFT) posted quarterly results that exceeded estimates on nearly every major metric, aided by another surge in the company's closely watched cloud computing business segment.

Outside of the mega-cap technology companies, a number of other corporations also posted resilient earnings results. Twitter (TWTR) shares gained in late trading after posting third-quarter sales that were about in-line with expectations, while Wall Street had braced for the company to see similar negative impacts from Apple's iOS privacy update as peer social media company Snap (SNAP) had reported for the same quarter.

And chipmaker Advanced Micro Devices (AMD) also delivered quarterly earnings that exceeded estimates and boosted its full-year forecast. The company noted that supply chain constraints were partially inhibiting its ability to meet demand to provide PC and video-game console chips, though CEO Lisa Su added during AMD's earnings call that she believed the current supply-side challenges would improve next year.

The latest batch of earnings results helped affirm to Wall Street that many companies have been able to work through rising price pressures to continue delivering estimates-topping sales and profits. Though many pundits have suggested inflationary pressures and supply chain disruptions could last for longer than previously anticipated, few have suggested the impacts will be insurmountable to most major companies.

"What we've got from these supply chain issues is a near-term earnings problem. I think it's something we do have to monitor in the first half of the year," Lori Calvasina, RBC Capital Markets chief equity strategist, told Yahoo Finance on Tuesday. "Earnings growth is only tracking at 4% or 6% in the first two quarters of next year. So companies do have to keep managing through for the market to continue to move up."

"But the reality is that the underlying economic backdrop simply is not stagnant," she added. "I really just don't buy into that stagflation argument at all."

And on the demand side, American consumers have shown few signs of slowing their spending in the face of rising inflation. The Conference Board said Tuesday that the percentage of consumers planning to purchase homes, automobiles and major appliances increased this month, even as short-term inflation expectations surged to a 13-year high.

"The consumer's got tons of cash right now so they don't mind the fact that they're raising prices on us – and that's the story right now," Ryan Payne, president of Payne Capital Management told Yahoo Finance Live on Tuesday. "That's why profits are going up. You've got a very price insensitive consumer, because we've got lots of cash. Wages are going up. And companies can keep essentially raising their prices as their costs go up. And that's why we're kind of in this Goldilocks economy right now— another reason why the market's going to continue to climb higher here."

9:13 a.m. ET: Durable goods orders fall by smaller-than-expected margin in September

Durable goods orders pulled back only modestly last month after four consecutive months of advances, reflecting ongoing resilience in the manufacturing sector despite ongoing supply chain challenges and materials shortages.

Orders for U.S. goods meant to last three years or longer dipped by 0.4% in September after a 1.3% increase in August, the Commerce Department said Wednesday. Consensus economists were looking for a 1.1% drop, according to Bloomberg consensus data.

Excluding transportation, durable goods orders up by the 0.4% monthly rate expected, building on gains after August's 0.3% rise. Non-defense capital goods orders, excluding aircraft, rose by 0.8%, exceeding estimates for 0.5%, and reflecting solid business capital spending trends. Non-defense capital shipments, excluding aircraft, rose by 1.4%, or nearly three times the rate expected. This metric is factored into measures of GDP."

MY COMMENT

AS USUAL.....I have BOLDED the important content in the above article. Just about ALL of it is POSITIVE........for stocks and the economy. The re-opening is happening.....slowly.....as you would expect. It is going to be a long, slow , road forward. I say the longer it takes the better. It will help to maintain the BULL MARKET.

MUCH of the economic data over the past week or two has been positive......the durable good orders above is positive.

 

I see that the DOW and the SP500 have now turned negative. No surprise there.....the NEGATIVE BOO BIRDS are out in force today in the financial media. PLUS....the markets have to pause once in a while to digest the recent gains as people decide to take profits and re-position.

Lucky for me I dont have to worry about this sort of stuff as a long term investor.

 

My opinion on inflation is the same as always......I DO NOT see a problem......so....I agree with the views in this little article.
Don’t listen to Jack Dorsey on inflation, says crypto bull Cathie Wood

https://finance.yahoo.com/news/don-t-listen-jack-dorsey-093728203.html

(BOLD is my opinion OR what I consider important content)
"Famed investor Cathie Wood and Twitter founder Jack Dorsey are squaring off on Twitter on the topic of hyperinflation.

After Dorsey went to his platform to ominously announce that “hyperinflation is going to change everything. It’s happening,” Wood took to Twitter to refute his claims.

The cofounder and CEO of ARK Invest believes that technological advancement, creative destruction—or companies selling obsolete goods at discounts to service debts—and a natural balancing of supply and demand after the holiday season will all suppress long-term supply chain–induced inflation.

https://twitter.com/CathieDWood/status/1452492766936772610

Cathie Wood expecting deflation goes against many in the market who are concerned about rising prices caused by tangled supply chains and skyrocketing post-pandemic demand.

In the tweet thread, the hot-handed investor noted that training costs for artificial intelligence are dropping 40% to 70% per year, providing one “record-breaking deflationary force.” She also found the number of companies catering “to short-term oriented shareholders who want profits/dividends now” do not invest enough in innovation and will be forced to sell their goods at a discount—another force pushing prices down.

But these are both long-term trends, which Elon Musk rightly pointed out.

https://twitter.com/CathieDWood/status/1452841794736119808

To which Cathie Wood responded by saying short-term inflation only flared in response to COVID-19–related supply chain bottlenecks and oil supply constraints—the latter of which she refers to as “an outlier and psychologically important” but that will sow the seeds of a serious oil price decline in the long term through the adoption of EVs.

Inflation has been on the minds of investors everywhere, fearing the poison will creep into corporate earnings and subsequently investor returns. The term “stagflation” was the most common word in client conversations last week, strategists at Goldman Sachs wrote in an investor note.

And talking about inflation breeds more inflation, so a comment by the famed Cathie Wood might cool an overheated market. Wood has a strong following on Reddit and made a name for herself in 2020 when her fund ARK Innovation returned 150% over the year. The fund, while currently down 2% in 2021, has seen more than $5.7 billion in inflows this year.

In one big area, Wood and Dorsey are in agreement. They are among the most prominent voices in the crypto bull crowd, with Wood lobbying U.S. regulators hard to make Bitcoin investing more accessible to everyday investors."

MY COMMENT

Yes...I am in total agreement and have posted that view on here for a long time. I am also in agreement and a long time poster as to the danger of DEFLATION.

Time will tell which view is right....but by the time we know.....it will be in the past anyway. Bottom line....the markets are not going to really care. As usual it will all be about business fundamentals on a company by company level for long term investors.

In my day to day life.......I hear many people talking about inflation.....stagflation.....fear.....etc, etc, etc. I just keep my mouth shut.......LOL.

 

WELL......EXCUSEEEEEEEEE MEEEEEEE. Ok....hyper-super-duper-inflation. NEVER-MIND.

Thanks for reminding me Zukodany.......I am so ashamed.

(I should not have to say this but....yes....sarcasm, as was the post.......that I was responding to and "like"...... by Zukodany)

 

I finally got around to looking at my....actual....account today. After what I have been seeing and hearing in the media today i expected perhaps a slight gain. NO.....I was surprised to see a BIG GAIN. I hope the stocks that are driving my portfolio today can hang on for the rest of the day. At the moment those drivers are......Microsoft +4.23%.....Home Depot +1.1%.....Google +3.74%.....and....Tesla +4.83%.

 

That was a very nice.....green..... day today. Unfortunately the gains of earlier that I had were cut back in the last hour or so of the market day. BUT.....why be greedy.....it was still a very nice gain today. My best holdings were Microsoft +4.21%....Google +4.96%.....and Tesla +1.95%.

I got a really nice beat on the SP500 today by 1.49%. I am thinking that beat today should put me ahead of the SP500 by at least 3%. But.....I have not looked.

 

Here is the big story of the day....although....not unexpected after their earnings reports.

Alphabet and Microsoft rise to records after quarterly earnings beat estimates

https://www.cnbc.com/2021/10/27/alphabet-and-microsoft-rise-to-records-after-q3-2021-earnings.html

(BOLD is my opinion OR what I consider important content)

"Key Points

• Analysts raised price targets on Microsoft, helping the company’s market capitalization close in on Apple, the most valuable public company.
• For Google parent Alphabet, analysts see revenue growth slowing in 2022, but that wasn’t enough to stop the stock from soaring.

Shares of Alphabet and Microsoft rallied to record highs on Wednesday after both companies reported third-quarter results that surpassed analysts’ expectations.

The stocks helped lift the tech-heavy Nasdaq Composite higher even as the S&P 500 and the Dow Jones Industrial Average were down slightly.

Alphabet jumped almost 5% to $2,924.35, giving the company a market cap of almost $2 trillion. Microsoft rose 4% to $323.17. With a market cap of $2.43 trillion, the software maker is approaching Apple’s valuation of $2.46 trillion.

Despite concerns about inflation, supply chain constraints and privacy changes made by Apple that limit advertisements, the world’s most-valuable tech companies continue to surpass growth expectations and prove their resilience to swings in the economy.

Google reported a 43% increase in advertising revenue to $53.1 billion, with YouTube ad sales rising to $7.2 billion from $5 billion a year earlier. Earnings of $27.99 a share topped analyst estimates for profit of $23.48, according to Refinitiv.

Google was able to skirt a major hit from Apple’s iOS privacy changes, which hurt quarterly results from Snap and Facebook. Ruth Porat, Alphabet’s finance chief, said Apple’s new features had a “modest impact” on its ad revenue.

“The ad market remains strong, and unlike most digital peers, Google doesn’t seem to be negatively impacted by iOS 14 or supply chain issues,” wrote Ross Sandler, an analyst at Barclays, in a note on Wednesday. “Longer-term Google remains the best positioned company in digital advertising and one of our favorite names,” wrote Sandler, who has a buy rating on the stock.

Revenue at Microsoft increased 22% in its fiscal first quarter from a year earlier to $45.3 billion, while earnings of $2.27 exceeded the average estimate of $2.07, according to Refinitiv.

For the current quarter, Amy Hood, Microsoft’s finance chief, said that even without the impact of an accounting change resulting in a longer useful life of data center equipment, she expects gross margin to go up by 2 percentage points as the company makes improvements in its cloud businesses.

Microsoft’s PC-related business, meanwhile, is powering through the global supply chain bottleneck. The company reported 10% revenue growth in Windows license sales to device makers,

“Microsoft overcame the two key concerns heading into the print – the PC exposure and margins,” UBS analysts, who have a buy rating on the stock, wrote in a note after the earnings report.

While investors are bullish on Google and Microsoft’s growth prospects, both companies signaled potential challenges ahead. The stocks are up 83% and 51%, respectively, in the past year.

Hood told analysts on Microsoft’s call to “watch the advertising market,” because companies hurt by supply issue may be less willing to spend. Search and news advertising accounts for about 6% of Microsoft’s revenue.

Google warned that growth rates won’t be as rosy as they’ve been in the last few periods, including 69% ad sales growth in the second quarter.

“Given the gradual recovery and results through the back half of 2020, the benefit of lapping prior year performance diminished in Q3 vs Q2 and will diminish further in Q4,” Porat said on Tuesday’s earnings conference call.

Analysts expect a slowdown in revenue growth into the first half of 2022, due in part to lower fees in the Google Play store and regulatory challenges."

MY COMMENT

Not much to say about these companies. They are BIG CAP GROWTH MONSTERS.....with great management. BOTH companies should have a very bright future.

 

And...here, in general, is how we ended the day.
Stock market news live updates: S&P 500 and Dow pull back from records, Nasdaq jumps as tech stocks gain after earnings

https://finance.yahoo.com/news/stock-market-news-live-updates-october-27-2021-221534323.html

(BOLD is my opinion OR what I consider important content)

"The S&P 500 and Dow pulled back from record levels on Wednesday while the Nasdaq gained, as investors eyed a slew of stronger-than-expected earnings results from closely watched technology companies. The Nasdaq 100 set a record high.

West Texas intermediate crude oil prices retreated after a recent run-up but remained near their highest level since 2014. Treasury yields sank across the curve, and the benchmark 10-year yield fell below 1.6%.

Google's parent-company Alphabet (GOOG, GOOGL) reached a record high, rising in its best day since February after posting third-quarter revenues and earnings that topped consensus estimates. These results were fueled by a further rise in online advertising spending, especially among retailers on Google Search. YouTube and Google Cloud revenue growth, however, slowed compared to the prior quarter. And Microsoft (MSFT) posted quarterly results that exceeded estimates on nearly every major metric, aided by another surge in the company's closely watched cloud computing business segment. The Redmond, Washington-based company also saw its stock jump to a record high on Wednesday following its latest report.

Outside of the mega-cap technology companies, a number of other corporations also posted resilient earnings results. Twitter (TWTR) shares gained in late trading after posting third-quarter sales that were about in-line with expectations, while Wall Street had braced for the company to see similar negative impacts from Apple's iOS privacy update as peer social media company Snap (SNAP) had reported for the same quarter.

And chipmaker Advanced Micro Devices (AMD) also delivered quarterly earnings that exceeded estimates and boosted its full-year forecast. The company noted that supply chain constraints were partially inhibiting its ability to meet demand to provide PC and video-game console chips, though CEO Lisa Su added during AMD's earnings call that she believed the current supply-side challenges would improve next year.

The latest batch of earnings results helped affirm to Wall Street that many companies have been able to work through rising price pressures to continue delivering estimates-topping sales and profits. Though many pundits have suggested inflationary pressures and supply chain disruptions could last for longer than previously anticipated, few have suggested the impacts will be insurmountable to most major companies.

"What we've got from these supply chain issues is a near-term earnings problem. I think it's something we do have to monitor in the first half of the year," Lori Calvasina, RBC Capital Markets chief equity strategist, told Yahoo Finance on Tuesday. "Earnings growth is only tracking at 4% or 6% in the first two quarters of next year. So companies do have to keep managing through for the market to continue to move up."

"But the reality is that the underlying economic backdrop simply is not stagnant," she added. "I really just don't buy into that stagflation argument at all."

And on the demand side, American consumers have shown few signs of slowing their spending in the face of rising inflation. The Conference Board said Tuesday that the percentage of consumers planning to purchase homes, automobiles and major appliances increased this month, even as short-term inflation expectations surged to a 13-year high.

"The consumer's got tons of cash right now so they don't mind the fact that they're raising prices on us – and that's the story right now," Ryan Payne, president of Payne Capital Management told Yahoo Finance Live on Tuesday. "That's why profits are going up. You've got a very price insensitive consumer, because we've got lots of cash. Wages are going up. And companies can keep essentially raising their prices as their costs go up. And that's why we're kind of in this Goldilocks economy right now— another reason why the market's going to continue to climb higher here."

4:09 p.m. ET: S&P 500, Dow pull back from records, Nasdaq jumps as Alphabet, Microsoft set all-time highs after earnings

11:23 a.m. ET: Holiday sales set to rise by more than 10% over last year in the U.S., according to NRF

Domestic sales during the key holiday shopping season could rise in excess of 10% over last year in 2021, according to new forecasts from the National Retail Federation.

The trade association said sales could rise between 8.5% and 10.5%, reaching as much as $859 billion in total between November and December. This would take out the previous record high of $777.3 billion in 2020.

The predictions are consistent with other holiday shopping forecasts from other bodies including Adobe Analytics. In a new forecast last week, the firm said it expected online sales alone would grow 10% to reach $207 billion between Nov. 1 and Dec. 31 this year."

MY COMMENT

We had weakness in the afternoon today.....especially toward the close. BUT....for investors in the BIG CAP GROWTH stocks like I own it was a very good day regardless.

Tomorrow.....we will see the Amazon earnings. I would not be surprised if the markets took a breather during the day tomorrow....while waiting for Amazon to report. We are on track for a very good week for investors. AND....once we get these BIG PRIMARY companies earnings out of the way.....we are on track for a very nice market all the way to the end of the year.