Through Aug 7, 2011, eighty-two Big High Tech Corps, with Pretax Earnings above $100 mil each, have released their 2Q 2011 earnings.
My definition of High Tech Corps is probably a bit broader than that of most people.
These 82 Big High Tech Corps, registered a Total Pretax Earnings increase of 21% in the 2Q 2011, decelerating a bit from their very robust Total Pretax Earnings growth of 26% in the 1Q 2011.
At first glance, that 21% earnings growth in the 2Q 2011 might not seem so hot.
But, that 21% growth in the 2Q 2011 over 2Q 2010 is on top of a spectacular 60% earnings growth registered by these 82 Big High Tech Corps in the 2Q 2010 over 2Q 2009….in other words, the base earnings moved up dramatically.
What that means is that the 2Q 2011 total compounded earnings growth of these 82 Big High Tech Corps increased by a blistering 93% in the two years from the 2Q 2009 to the 2Q 2011…..what I call the Obama Administration Two-Year Bump of High Tech.
Granted, this is down from the peak Obama Administration Two-Year Earnings Growth Bump of Big High Tech for these same 82 Corps for the 1Q 2011 over 1Q 2009 of 124%.....no, I’m not kidding, that's the number. But still, two year earnings growth of 93% is just fantastic.
There still is a major problem with the US mix of these Big High Tech Earnings. More smart initiatives are needed to incentivize Big High Tech Corps to reshore more of their offshore earnings, and the related jobs, back to the US.
Also, there is a need to spread this earnings growth over more High Tech Corps. If you exclude Apple, the 81 other Big High Tech Corps registered total earnings growth of 11%, as compared with the total earnings growth of 21% when Apple is included.
Below here are these 2Q 2011 Pretax Earnings (PTI), along with a comparison with the prior year’s quarter amounts.
.......................................................................Increase
............................................PTI........PTI.......(Decrease)
.............................................2Q.........2Q..................
...........................................2011......2010....Amount....%
.............................................(millions of dollars)
Apple.................................9,551.....4,292.....5,259...123%
Microsoft...........................6,319.....6,024........295......5%
IBM...................................4,885.....4,575........310......7%
Oracle................................4,170.....3,075.....1,095....36%
Intel...................................3,931.....4,185.......(254)...-6%
Google...............................3,085.....2,434........651....27%
Hewlett Packard.................2,892.....2,767.......125......5%
Cisco Systems.....................2,203.....2,403.....(200)...-8%
Qualcomm..........................1,274.....1,076.......198....18%
Dell.....................................1,170........451.......719...159%
Honeywell...........................1,100.......767.......333....43%
Intuit..................................1,052.......878.......174....20%
Emerson Electric....................992.......863.......129....15%
Accenture..............................958.......803.......155....19%
Texas Instruments.................909.....1,111......(202)..-18%
Corning..................................878.......944......(66)....-7%
EMC.......................................764.......577.......187....32%
Applied Materials...................686.......387.......299....77%
Danaher.................................597.......490.......107....22%
Ebay(1)..................................548.......499.........49....10%
Johnson Controls...................469.......457.........12......3%
Activision Blizzard.................469.......301.......168....56%
TE Connectivity, Ltd..............431.......475.......(44)...-9%
Xerox....................................401.......320.........81....25%
Sandisk..................................365.......359..........6......2%
Automatic Data Proc..............359.......306........53....17%
KLA Tencor............................334.......150.......184...123%
CA Technologies.....................333.......308........25......8%
Priceline.................................317.......166.......151....91%
Analog Devices.......................297.......214........83....39%
Cognizant Technology.............278.......208.......70....34%
Symantec................................270.......164.......106....65%
Goodrich.................................265.......238........27....11%
Agilent Technologies...............260.......139.......121....87%
Adobe Systems........................259.......194........65....34%
Thermo Fisher Scient...............256.......261........(5)...-2%
Altera......................................238.......206........32....16%
Electronic Arts........................230.........93.......137...147%
Broadcom(2)...........................226.......276.......(50)..-18%
Amazon.com(3).......................225.......297.......(72)..-24%
Micron Technology(4).............225.......501......(276)..-55%
Arrow Electronics....................223.......170........53....31%
NetApp....................................208.......164........44....27%
SAIC........................................207.......188........19....10%
Amphenol...............................206.......166........40....24%
Fiserv(5).................................203.......205........(2)....-1%
Harris Corp.............................201.......228.......(27)...-12%
Expedia...................................196.......176........20....11%
VMware(6)..............................190........97........93....96%
Yahoo.....................................188.......185..........3......2%
Paychex..................................184.......175..........9......5%
Xilinx......................................180.......203.......(23)..-11%
Maxim Integrated Prods..........176.......143........33....23%
Linear Technology...................175.......168..........7......4%
Western Digital.........................170.......292....(122)..-42%
Check Point Software................161.......129........32....25%
Pitney Bowes............................159.......104........55....53%
Juniper Networks.....................157.......189.......(32)..-17%
Nvidia......................................156.......151..........5......3%
Roper Industries......................155.......101........54....53%
Flextronics..............................149.......130........19....15%
Marvell Technology.................148.......205.......(57)..-28%
Lam Research..........................137.......159.......(22)..-14%
Teradata..................................137.......106........31....29%
Lexmark..................................131.......113.........18....16%
Seagate Technology.................129.......340......(211)..-62%
Jabil Circuit.............................127........77.........50....65%
BMC Software...........................114.......103.........11....11%
Microchip Technology.............114.......106..........8......8%
Alliance Data Systems..............113.........77.........36....47%
Garmin(7)................................112.......120.........(8)....-7%
Vishay Intertechnology...........111.......105...........6......6%
Netflix......................................111........73.........38....52%
Cerner......................................111.........86.........25....29%
Atmel(8)..................................110.........30.........80...267%
Verisk Analytics.......................109.........99.........10....10%
Amdocs....................................105.......102..........3......3%
Alliant Techsystems.................104.......115.........(11)..-10%
Citrix Systems..........................101.........75.........26....35%
Teradyne...................................98........136........(38)..-28%
DST Systems..............................83........144........(61)..-42%
First Solar.................................72........180......(108)..-60%
Total 82 High Tech Corps...60,492...50,149...10,343....21%
(1) Ebay 2011 PTI excludes large loss on divested business.
(2) Broadcom 2011 PTI excludes large asset impairments, settlement gains and charitable contribution.
(3) Amazon.com 2011 PTI includes a large increase in technology cost charges
(4) Micron Technology 2011 PTI excudes large gain on acquisition.
(5) Fiserv 2011 PTI excludes loss on debt extinguishment.
(6) VMware 2011 PTI excludes gain on sale of Terremark Investment.
(7) Garmin PTI in both years exclude foreign currency gains.
(8) Atmel 2010 PTI excludes loss on sale of assets and asset impairment charge.
And then below here are these 2Q 2011 Pretax Earnings (PTI), along with a comparison with the two-year earlier 2Q 2009 Pretax Earnings.
.......................................................................Obama
.......................................................................Admin
........................................................................Bump
.......................................................................Increase
............................................PTI........PTI.......(Decrease)
.............................................2Q.........2Q..................
...........................................2011......2009....Amount....%
.............................................(millions of dollars)
Apple.................................9,551.....2,692.....6,859....255%
Microsoft...........................6,319.....4,142.....2,177.....53%
IBM...................................4,885.....4,262.......623.....15%
Oracle...............................4,170.....2,754.....1,416.....51%
Intel..................................3,931.....1,397.....2,534....181%
Google...............................3,085.....1,856.....1,229.....66%
Hewlett Packard.................2,892.....2,113.......779.....37%
Cisco Systems.....................2,203.....1,687......516.....31%
Qualcomm..........................1,274.......984.......290.....29%
Dell.....................................1,170.......412.......758....184%
Honeywell...........................1,100.......626......474.....76%
Intuit..................................1,052.......759.......293.....39%
Emerson Electric....................992.......553.......439.....79%
Accenture..............................958.......748.......210.....28%
Texas Instruments..................909.......356.......553....155%
Corning..................................878.......607.......271.....45%
EMC.......................................764.......249........515....207%
Applied Materials...................686......(306)......992....324%
Danaher..................................597.......314.......283.....90%
Ebay.......................................548.......407.......141.....35%
Johnson Controls....................469.......217.......252....116%
Activision Blizzard..................469.......218.......251....115%
TE Connectivity, Ltd................431........31.......400...1290%
Xerox......................................401.......197.......204....104%
Sandisk....................................365........73.......292....400%
Automatic Data Proc................359.......361........(2)....-1%
KLA Tencor..............................334.......(46)......380....826%
CA Technologies......................333.......308........25......8%
Priceline..................................317........99........218....220%
Analog Devices........................297........62........235....379%
Cognizant Technology..............278.......169.......109.....64%
Symantec.................................270.......128.......142....111%
Goodrich..................................265.......204.........61.....30%
Agilent Technologies................260.......(58).......318....548%
Adobe Systems.........................259.......164.........95.....58%
Thermo Fisher Scient................256.......232.........24.....10%
Altera.......................................238.........67.......171....255%
Electronic Arts..........................230......(258).....488....189%
Broadcom.................................226........17........209...1229%
Amazon.com.............................225.......179........46.....26%
Micron Technology...................225......(293)......518....177%
Arrow Electronics.....................223........35........188....537%
NetApp.....................................208........25........183....732%
SAIC.........................................207.......189.........18.....10%
Amphenol.................................206.......106.......100.....94%
Fiserv.......................................203.......179.........24.....13%
Harris Corp...............................201.......169.........32.....19%
Expedia....................................196.......150.........46.....31%
VMware....................................190........39.......151....387%
Yahoo......................................188.......148.........40.....27%
Paychex....................................184.......175..........9.......5%
Xilinx........................................180........46.......134....291%
Maxim Integrated Prods............176.......(17)......193...1135%
Linear Technology.....................175.......138........37.....27%
Western Digital..........................170.......207......(37)...-18%
Check Point Software..................161........95........66.....69%
Pitney Bowes.............................159.......179.......(20)...-11%
Juniper Networks.......................157........97.......60.....62%
Nvidia.......................................156......(225)......381....169%
Roper Industries........................155........85........70.....82%
Flextronics................................149.......(51)......200....392%
Marvell Technology....................148......(109)....257....236%
Lam Research.............................137.......(62).....199....321%
Teradata.....................................137........84........53.....63%
Lexmark.....................................131........21.......110....524%
Seagate Technology....................129.......(56)......185....330%
Jabil Circuit...............................127.......(27)......154....570%
BMC Software.............................114.......108..........6.......6%
Microchip Technology................114........33.........81....245%
Alliance Data Systems.................113........46.........67....146%
Garmin.......................................112.......200.......(88)...-44%
Vishay Intertechnology..............111.......(25)......136....544%
Netflix........................................111.........53.........58....109%
Cerner.........................................111.........66........45.....68%
Atmel..........................................110.......(22)......132....600%
Verisk Analytics..........................109........79.........30.....38%
Amdocs......................................105........96...........9.......9%
Alliant Techsystems.....................104.......111........(7).....-6%
Citrix Systems.............................101........45.........56.....124%
Teradyne......................................98.......(69)......167....242%
DST Systems..................................83........81..........2.......2%
First Solar.....................................72.......201.....(129)...-64%
Total all 82............................60,492...31,306...29,186....93%
I think the US stock market has clearly over-reacted on the downside.
I also think this monstrous US stock market collapse is predominantly the result of just one thing…..the decision by the Republican House Leadership (Boehner, Canter, McCarthy and Hensarling) to abandon, after they were substantially done, the Grand Bargain talks with President Obama.
And this led to a chain reaction of events which leaves us to where we are now.
The Grand Bargain would have reduced the US Debt by $4 trillion in 10 years and by much more than $10 trillion in 20 years. It was balanced, at least to some degree, by raising tax revenues. It wisely closed some tax loopholes. It dealt modestly, but wisely, with entitlement cuts. And it even contained some desperately needed economic growth, with the resultant job creation flowing from it.
The Grand Bargain is precisely what S&P was looking for.
Instead, by the Republican House Leaders abandoning talks with the Obama Administration, the US Congress was widely exposed for its inability to get things done, for the arrogance and myopic views of many of its members, for its whole-scale lack of financial expertise, for the despicable harsh insults of many of its members, and for the extreme stubbornness of many of its members.
And the final deal struck was only a $2.4 trillion debt reduction. And the majority of this $2.4 trillion, won’t be decided until November, and even then, it could be a lower $2.1 trillion.
The S&P was precisely correct in downgrading US Debt. Given the above actions, where the Republican leadership of the US Congress was clearly acting so incompetently, when it was faced with a major financial crisis, S&P did the responsible thing. If the Chief Financial Officer of a major corporation acted like the US Congress did here, he would be instantly canned.
And to pile on, the US Congress goes on vacation for more than 5 weeks, while it has left the country to burn.
Obviously, what should happen is for the US Congress to immediately reconvene. And the talks on the Grand Bargain between the Obama Administration and the Republican Leaders should start up again, and trump this crazy prolonged Congressional “Super Committee”. The US Congress made a disastrous mistake. The stock market is signaling that. It’s time for the US Congress to correct its mistake. If this were to occur, watch the US stock market surge.
=======================================
..................................................................................Increase
......................................................PTI.......PTI.........(Decrease)
.....................................................2011......2010....Amount....%
.......................................................(millions of dollars)
Late Additions on Aug 18, 2011
Scripps Ntwrks Interactive..OH......257.......195..........62.....32%
Motorola Solutions(A)..........IL......154........129..........25.....19%
Computer Sciences..............VA......101.......211........(110)...-52%
Motorola Mobility(B)............IL......(17)......(136).......119....188%
(A) Motorola Solutions 2011 PTI excludes Loss on Debt Extinguishment.
(B) Motorola Mobility 2010 PTL excludes Legal Settlement Gain.
