Texas Instruments and Other Overlooked Dividend Aristocrat Stocks — Barrons.com

The semiconductor sector has been on a remarkable rally in the past month. The expansion of artificial intelligence (AI) applications and the new monetary easing era led to a rally in semiconductor stocks. Additionally, a spate of stronger earnings reports from well-known players in the space added to the strength.

As such, VanEck Vectors Semiconductor ETF SMH, iShares Semiconductor ETF SOXX, Invesco PHLX Semiconductor ETF SOXQ, First Trust NASDAQ Semiconductor ETF FTXL and Strive U.S. Semiconductor ETF SHOC have gained 4.5%, 0.4%, 1.8%, 2.1% and 2.4%, respectively, in the past month.

Let’s dig into the individual earnings releases:

Semiconductor Earnings in Focus

Intel INTC, the world’s largest chipmaker, reported a loss per share of 46 cents, wider than the Zacks Consensus Estimate of a loss of 20 cents. Revenues declined 6% year over year to $13.28 billion and edged past the estimated $13 billion. For the current quarter, Intel guided revenues of $13.3-$14.3 billion and adjusted earnings of 12 cents per share.

Texas Instruments TXN reported solid third-quarter 2024 results. Earnings beat the Zacks Consensus Estimate by 11 cents but revenues lagged the same by $40 million. For the fourth quarter of 2024, the company expects revenues in the range of $3.70-$4.00 billion and earnings per share in the band of $1.07-$1.29.

Lam Research LRCX topped revenue and earnings estimates for first-quarter fiscal 2025. Earnings per share of 86 cents surpassed the Zacks Consensus Estimate by 6 cents, while revenues of $4.17 billion edged past the estimated $4.05 billion. For second-quarter fiscal 2025, the company expects revenues of $4.30 billion (+/- $300 million) and earnings per share of 87 cents (+/- 10 cents).

Taiwan Semiconductor Manufacturing TSM reported robust third-quarter 2024 results. The company reported earnings per ADR of $1.94, which outpaced the Zacks Consensus Estimate of $1.74. Revenues rose 36% year over year to $23.5 billion and were above the estimate of $22.72 billion. For the fourth quarter, the company expects revenues to grow 35% year over year to $26.1-$26.9 billion (read: Buy Taiwan Semiconductor-Heavy ETFs on Upbeat Earnings).

Advanced Micro Devices AMD reported earnings of 92 cents per share, beating the Zacks Consensus Estimate by a penny. Revenues of $6.82 billion edged past the consensus mark of $6.71 million. AMD expects fourth-quarter 2024 revenues of $7.5 billion (+/-$300 million).

At Qualcomm QCOM, fourth-quarter fiscal 2024 earnings per share of $2.69 surpassed the Zacks Consensus Estimate by 13 cents. Revenues of $10.24 billion edged past the estimate of $9.9 billion. The company projects revenues of $10.5-$11.3 billion and earnings per share in the range of $2.85-$3.05 for the first quarter of fiscal 2025.

ETFs in Focus

VanEck Vectors Semiconductor ETF (SMH)

VanEck Vectors Semiconductor ETF provides exposure to 26 companies involved in semiconductor production and equipment by tracking the MVIS US Listed Semiconductor 25 Index. It has managed assets worth $25.4 billion and charges 35 bps in annual fees and expenses. The in-focus six firms account for 33.4% share in the basket.

VanEck Vectors Semiconductor ETF is heavily traded, with a volume of around 6 million shares per day. It has a Zacks ETF Rank #1 (Strong Buy) with a High risk outlook.

iShares Semiconductor ETF (SOXX)

iShares Semiconductor ETF follows the NYSE Semiconductor Index and offers exposure to U.S. companies that design, manufacture and distribute semiconductors. It holds 30 securities in its basket, with the in-focus six firms collectively making up 33.4% of the assets.

iShares Semiconductor ETF has amassed $14.4 billion in its asset base and trades in a volume of about 3 million shares a day. The product charges a fee of 35 bps a year from investors and has a Zacks ETF Rank #1 with a High risk outlook (read: Leveraged ETFs for Longer-Term Investors).

Invesco PHLX Semiconductor ETF (SOXQ)

Invesco PHLX Semiconductor ETF tracks the PHLX Semiconductor Sector Index, holding 30 stocks in its basket. The in-focus six firms collectively make up a combined 28.6% share in the basket.

Invesco PHLX Semiconductor ETF has accumulated $510.2 million in its asset base. It charges 19 bps in annual fees and trades in an average daily volume of 405,000 shares. SOXQ FTXL has a Zacks ETF Rank #1.

First Trust Nasdaq Semiconductor ETF (FTXL)

First Trust Nasdaq Semiconductor ETF offers exposure to the most-liquid U.S. semiconductor securities based on volatility, value and growth by tracking the Nasdaq US Smart Semiconductor Index. FTXL holds 31 stocks in its basket, with in-focus six firms accounting for a combined 26.8% share.

First Trust Nasdaq Semiconductor ETF has accumulated $1.4 billion in AUM. The average trading volume is light at around 28,000 shares and the expense ratio is 0.60%. FTXL has a Zacks ETF Rank #1 (read: What Lies Ahead for Semiconductor ETFs: Boom or Gloom?).

Strive U.S. Semiconductor ETF (SHOC)

Strive U.S. Semiconductor ETF seeks broad market exposure to the U.S. semiconductor sector. It follows the Bloomberg US Listed Semiconductors Select Total Return Index and holds 32 stocks in its basket, with in-focus firms accounting for a combined 22.5% share.

Strive U.S. Semiconductor ETF has AUM of $81.4 million and charges 40 bps in annual fees. It trades in a volume of 27,000 shares per day on average and has a Zacks ETF Rank #1.

Zacks Investment Research

The S&P 500 Index today is up +0.08%, the Dow Jones Industrials Index is up +0.18%, and the Nasdaq 100 Index is down -0.08%.

Stock index futures recovered from overnight losses and are mixed. The broader market is climbing on a relief rally after US October consumer prices rose as expected. Stocks also found support, and T-note yields fell further on dovish comments from Minneapolis Fed President Kashkari, who said inflation is headed in the right direction and he doesn't think inflation is stuck above the Fed's 2% target. Weakness in chip stocks is weighing on the Nasdaq 100.

US Oct CPI rose +0.3% m/m and +2.6% y/y, right on expectations. Oct CPI ex-food and energy remained unchanged from Sep at +3.3% y/y, right on expectations.

US MBA mortgage applications rose +0.5% in the week ended November 8, with the purchase mortgage sub-index up +1.9% and the refinancing sub-index down -1.5%. The average 30-year fixed rate mortgage rose +5 bp to 6.86% from 6.81% in the prior week.

Stocks have rallied sharply over the past week, with the S&P 500, Dow Jones Industrials, and the Nasdaq 100 posting new record highs on speculation President-elect Trump will boost corporate profits through tax cuts and reduced regulation.

The markets are looking ahead to Friday’s report on retail sales that will be looked at to see if consumer spending is holding up. Oct retail sales are expected to be up +0.3% m/m, and Oct retail sales ex-autos are also expected to be up +0.3% m/m. Also, the Q3 earnings season is wrapping up, with more than 50 companies scheduled to report quarterly results this week.

Of the 85% of companies in the S&P 500 that have released Q3 earnings so far, 75% surpassed the estimates, slightly below the 3-year average. According to Bloomberg Intelligence, companies in the S&P 500 have reported an average +8.4% y/y increase in quarterly earnings in Q3, more than double the preseason forecast.

The markets are discounting the chances at 82% for a -25 bp rate cut at the December 17-18 FOMC meeting.

Overseas stock markets today are mixed. The Euro Stoxx 50 fell to a 3-month low and is down -0.43%. China's Shanghai Composite Index closed up +0.51%. Japan's Nikkei Stock 225 fell to a 1-week low and closed down -1.66%.

Interest Rates

December 10-year T-notes (ZNZ24) today are up by +11 ticks. The 10-year T-note yield is down -2.8 bp to 4.440%. T-notes are moving moderately higher after today’s US October consumer price report was right on expectations, easing inflation concerns. The benign CPI report boosted the chances of a 25 bp rate cut by the Fed next month to 82% from 62% before the report. Also, dovish comments from Minneapolis Fed President Kashkari gave T-note a boost when he said that inflation is headed in the right direction.

European government bond yields today are mixed. The 10-year German bund yield is up +0.3 bp to 2.365%. The 10-year UK gilt yield is down -2.7 bp to 4.472%.

ECB Governing Council member and Bundesbank President Nagel said core inflation is still quite high, and there are still noticeable price pressures, especially in services. He added that President-elect Trump's tariff plans could cost Germany 1% of GDP and could cause economic contraction.

Swaps are discounting the chances at 100% for a -25 bp rate cut by the ECB at its December 12 policy meeting and at 23% for a -50 bp rate cut at the same meeting.

US Stock Movers

Albemarle is up more than +7% after RBC Capital Markets raised its price target on the stock to$133 from $108.

Charter Communications is up more than +3% after agreeing to buy Liberty Broadband in an all-stock transaction.

Tesla is up more than +4% to lead gainers in the Nasdaq 100 on speculation the company will benefit from President-elect Trump’s policies and after Trump picked Tesla CEO Musk to lead the new Department of Government Efficiency.

Cava Group is up more than +15% after reporting Q3 restaurant comparable sales rose +18.1%, stronger than expectations of +12.4%, and raised its full-year restaurant comparable sales to +12%-13% from a previous forecast of +8.5%-9.5%, well above the consensus of +9.95%.

Rivian Automotive is up more than +22% after Volkswagen AG raised its investment plans in the company by $800 million.

Spotify Technology is up more than +9% after forecasting Q4 monthly active users of 665 million, stronger than the consensus of 660.73 million.

Pure Storage is up more than +4% after Oppenheimer & Co initiated coverage on the stock with a recommendation of outperform with a price target of $70.

Emerson Electric is up more than +1% after BNP Paribas Exane initiated coverage on the stock with a recommendation of outperform with a price target of $155.

Maplebear Inc is down more than -10% after forecasting Q4 adjusted Ebitda of $230 million-$240 million, below the consensus of $244.4 million.

Skyworks Solutions is down more than -4% to lead losers in the S&P 500 after forecasting Q1 revenue of $1.05 billion-$1.08 billion, weaker than the consensus of $1.09 billion.

Chip stocks are under pressure today to weigh on the overall market. KLA Corp is down more than -2% to lead losers in the Nasdaq 100. Also, ON Semiconductor , Lam Research , Texas Instruments , Micron Technology , Applied Materials , Analog Devices , and Qualcomm are down more than -1%.

Super Micro Computer is down more than -2% after saying it is unable to file its quarterly report on form 10-Q for the period ended September as it needs time to find a new auditor.

Groupon is down more than -28% after reporting Q3 revenue of $114.5 million, below the consensus of $118 million, and forecast full-year revenue of $486 million-$493 million, weaker than the consensus of $507.3 million.

Rocket Cos is down more than -12% after forecasting Q4 adjusted net revenue of $1.05 billion-$1.20 billion, well below the consensus of $1.32 billion.

Caterpillar is down more than -1% to lead losers in the Dow Jones Industrials after Evercore ISI downgraded the stock to underperform from in line with a price target of $365.

International Paper is down more than -1% after BNP Paribas Exane downgraded the stock to underperform from neutral with a price target of $48.20.

Earnings Reports (11/13/2024)

Cisco Systems Inc (CSCO), Loar Holdings Inc (LOAR), NU Holdings Ltd/Cayman Islands (NU), Tetra Tech Inc (TTEK).

On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policyhere.

On CNBC's “Halftime Report Final Trades,” Bill Baruch of Blue Line Capital picked Microsoft Corporation , expecting it to outperform the Nasdaq between now and the end of the year.

On Oct. 30, Microsoft reported first-quarter revenue of $65.60 billion, up 16% year-over-year. The total beat a Street consensus estimate of $64.51 billion according to data from Benzinga Pro. The company reported first-quarter earnings per share of $3.30, beating a Street consensus estimate of $3.09 per share.

Don't forget to check out our premarket coverage here

Bryn Talkington of NewEdge Wealth named Invesco S&P 500 Equal Weight ETF as her final trade.

Rob Sechan of NewEdge Wealth picked Salesforce, Inc. .

Salesforce will release its third quarter fiscal year 2025 results, after the closing bell on Tuesday, Dec. 3. Analysts expect the company to report quarterly earnings at $2.44 per share, up from $1.96 per share in the year-ago period. The company projects to report quarterly revenue of $9.34 billion.

Stephanie Link of Hightower said she expects a solid quarter from Target Corporation .

On Oct. 22, Bernstein analyst Dean Rosenblum initiated coverage on Target with a Market Perform rating and announced a price target of $168.

Price Action:

• Invesco S&P 500 Equal Weight ETF fell 0.8% during Tuesday's session.
• Salesforce shares fell 0.2% to settle at $341.15 during Tuesday's session.
• Microsoft gained 1.6% during Tuesday's session.
• Target shares gained 1.6% to close at $155.65 on Tuesday.

Check This Out:

• Top 3 Tech And Telecom Stocks Which Could Rescue Your Portfolio In Q4

Image: Shutterstock

© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

Bayer AG BAYRY reported third-quarter 2024 core earnings of 7 cents per American Depositary Receipt (ADR), which missed the Zacks Consensus Estimate of 17 cents. The company reported earnings of 10 cents per ADR in the year-ago quarter.

Core earnings of €0.24 per share deteriorated 36.8% year over year due to impairment losses at the Crop Science division.

Total sales in the reported quarter were $10.9 billion (€9.9 billion), down 3.6% on a reported basis.

On a currency and portfolio-adjusted basis, sales increased 0.6% year over year.

Year to date, shares of Bayer have lost 30.1% against the industry’s growth of 11.6%.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

All growth rates mentioned below are on a year-over-year basis after adjusting for currency and portfolio changes.

BAYRY’s Q3 Results in Detail

Bayer reports under three segments, namely Crop Science, Pharmaceuticals and Consumer Health.

In the reported quarter, Crop Science sales decreased 3.6% to €4 billion. Within this segment, Herbicides business was down 11.5% due to volume declines for glyphosate-based products. This was mainly due to purchasing patterns normalizing in Latin and North America.

Fungicides sales were up 13.1% due to increased volumes in all regions. Corn Seed & Traits sales decreased 19.3% due to an overall acreage decline, primarily driven by Latin America. Sales from the Soybean Seed & Traits business declined 2.5% due to a weather-related delay to the start of the season in Latin America. The Insecticides business also grew 9.5%, driven by higher volumes in Latin America. The Vegetable Seeds business recorded encouraging gains that were largely driven by higher volumes and prices in Latin America.

BAYRY’s revenues in the Pharmaceuticals segment increased 2.3% to €4.5 billion. Nubeqa (for cancer) sales surged 83.2% to €417 million, recording gains in all regions and witnessing significant improvements in volumes, especially in the United States and EU. Kerendia sales surged 96.4%, mainly due to a substantial rise in volumes in the United States and business expansion in China.

However, sales of oral anticoagulant Xarelto, co-developed with J&J JNJ, decreased 23% to €802 million due to competitive pressure from generics, especially in Canada and Europe.

In the U.S. market, Xarelto is marketed by J&J. Bayer earns license revenues from JNJ for Xarelto sales in the United States.

Sales of the ophthalmology drug, Eylea, increased 8.6% to €848 million, driven by higher volumes in Europe and Japan as well as a one-time effect of reimbursement in the United Kingdom.

Please note that Bayer’s HealthCare unit co-develops Eylea with Regeneron REGN, which records net product sales of Eylea in the United States. BAYRY records net product sales of Eylea outside the country. REGN records its share of profits/losses in connection with the sales of Eylea outside the United States.

Consumer Health sales rose 5.7% to €1.4 billion, driven by increases in Dermatology (+7.4%) and Pain & Cardio (+10.9%) categories. Dermatology sales gained from continued strong demand for Bepanthen.

Nutritionals (+3.6%) and Allergy & Cold business (+3.1%) also boosted the Consumer Health business.

BAYRY Updates 2024 Guidance

Bayer reiterated its previously provided currency-adjusted guidance for 2024 for the total group. The company expects to generate sales in the range of €47-€49 billion.

However, in view of the weaker-than-anticipated development of the agricultural market, BAYRY revised its forecast for divisional sales. Business performance is below initial expectations at Crop Science and Consumer Health. Nonetheless, Pharmaceuticals division sales is likely to come in at the upper end of the revised guidance.

For the Crop Science Division, Bayer now expects currency and portfolio-adjusted sales growth to decline around 1% to 3% (previous forecast -1% to +3%). For the Pharmaceuticals Division, Bayer expects currency and portfolio-adjusted sales growth to be flat to grow 3% (previous forecast: down -4% to flat year over year). Consumer Health sales growth is projected to increase between 1% and 3% (previous forecast: 3-6%).

Bayer Aktiengesellschaft Price, Consensus and EPS Surprise

Bayer Aktiengesellschaft price-consensus-eps-surprise-chart | Bayer Aktiengesellschaft Quote

Pipeline Updates

In September, BAYRY obtained received regulatory approval for the Eylea 8 mg pre-filled syringe in the European Union.

The company also filed a new drug application (NDA) with the FDA for a third indication for cancer drug Nubeqa (darolutamide) for its use in combination with androgen deprivation therapy (ADT) in patients with metastatic hormone-sensitive prostate cancer (mHSPC).

In October, BAYRY announced that the FDA had accepted the NDA for elinzanetant, an investigational compound for the non-hormonal treatment of moderate to severe vasomotor symptoms associated with menopause.

Our Take on BAYRY's Q3 Perfomance

Although Bayer’s earnings declined in the third quarter due to impairment losses at the Crop Science division, sales growth was encouraging at the Pharmaceutical division. New products, Nubeqa and Kerendia, retained their impressive momentum and offset the negative impact of a decline in Xarelto sales. Consumer Health business, too, posted growth. However, the Crop Science business was adversely impacted by significant declines in glyphosate-based herbicides.

The company is working to expand the labels of its key drugs, Nubeqa and Kerendia, which should boost growth.

Successful drug development is imperative for Bayer amid multiple challenges. The failure of a late-stage study on asundexian was a major setback for the company. BAYRY had earlier slashed dividends to conserve cash as increasing Roundup litigation charges adversely impacted the bottom line.

Bayer's Zacks Rank

BAYRY currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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