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Goldman Beats on Bottom-line, Misses on Top-line

Goldman Sachs Group Inc (NYSE:GS) shares are now up by 2.44% after the global investment bank turned in a mixed first quarter. For the period, Goldman Sachs earned $2.68 per share on revenue of $6.34 billion, beating earnings estimates by $0.23 per share but missing revenue expectations by $390 million. Revenue dropped by 40.3% year-over-year due to headwinds in almost every business line.

CEO Lloyd Blankfein summed up the results thusly:

“The operating environment this quarter presented a broad range of challenges, resulting in headwinds across virtually every one of our businesses. Looking ahead, we will continue to focus on delivering superior service to our clients and managing our business efficiently, which remain essential to generating shareholder value over the long term.”

To Mr. Blankfein’s credit, Goldman’s compensation and benefits expenses also fell by 40% year-over-year, meaning that the company’s employees and shareholders are sharing the pain equally. Tangible book value rose by 1% to $163.54 per share. 59 elite funds owned 7.7% of Goldman Sachs Group Inc (NYSE:GS) at the end of the fourth quarter.

Harley-Davidson Proves Bearish Analysts Wrong

Although some analysts were bearish on Harley-Davidson Inc (NYSE:HOG) due to channel checks that indicated competitors taking market-share, the company soundly beat expectations for the first quarter, delivering EPS of $1.36 on sales of $1.58 billion. Those results were $0.06 per share and $80 million better than the consensus estimates respectively. Global shipments rose by 1.4% year-over-year to 57,458 units while Harley’s operating margin dropped by 180 basis points to 21.1%. Harley Davidson expects to ship a total of between 269,000 and 274,000 motorcycles in 2016 and to report full year operating margin of between 16% and 17%. The company expects to ship between 82,500 and 87,500 units in the second quarter. Nonetheless, Harley-Davidson Inc (NYSE:HOG) is now down by 2.45% this morning after being up by 1.7% at one point in pre-market trading. The number of funds that we track with holdings in the stock was unchanged during the fourth quarter at 24.

Philip Morris Misses the Mark

Philip Morris International Inc. (NYSE:PM) turned in a disappointing first quarter with EPS of $0.98 on net sales of $6.08 billion both missing the consensus estimates, by $0.13 per share and $280 million respectively. The strong dollar had a big impact on the company, as Philip Morris would have experienced a 2.4% revenue rise when factoring out currency effects versus the actual 8.2% revenue decline. Due to the falling revenue, the company’s adjusted operating margin dropped by 280 basis points to 41.9%. The company anticipates making $4.40 per share-to-$4.50 per share for fiscal year 2016. The number of elite funds in our system with holdings in Philip Morris International Inc. (NYSE:PM) fell to 35 from 42 quarter-over-quarter during the fourth quarter.

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