1. 1. 3 Tech Stocks That Soared This Week
2. 2. These 3 tech stocks beat the market, July 20 July 25 2015
3. 3. SanDisk gained 11.6%, thanks to a great second-quarter report.
4. 4. Could have been worse SanDisk's second-quarter sales decreased 24% compared to the year-ago period, stopping at $1.24 billion. At the same time, adjusted earnings fell from $1.41 to $0.66 per share. Those were terrible figures but analysts expected even worse. The Street's consensus pointed to earnings of just $0.33 per share on $1.2 billion in sales. SanDisk cleared that ultra-low bar with room to spare.
5. 5. Where's the good news? SanDisk was hoping to make a splash with flash-based solid-state drives for both consumer and enterprise markets, but a sudden slowdown in the PC systems market put those dreams on hold. Furthermore, Apple recently stopped using SanDisk SSDs in its MacBook Air product line, causing a large drop in sales of consumer- grade storage. These factors had been folded into estimates for the quarter. SanDisk mitigated the lost Apple contract by landing solid order volumes from other consumer-level system builders, and also performed well in direct retail sales of SanDisk-branded products. Finally, SanDisk believes that it may have won back that missing Apple deal, shipping MacBook Air drives as soon as the third quarter.
6. 6. What's next? SanDisk must still execute crisply in the second half. And if the final formalities in the Apple partnership fall through the cracks, sales will stay way down. Investors do count on these execution risks. SanDisk shares are down 37% year-to-date, even after this week's massive jump. The stock also sees plenty of negative bets, as 7.2% of SanDisk shares have been sold short right now. Can SanDisk return to full health and a more generation? Certainly. Will that happen? Hard to tell. Tread softly around this stock. SanDisk's risks may outweigh its potential rewards.
7. 7. Intuitive Surgical also crushed it in the second quarter, to the delight of shareholders.
8. 8. Growing in all the right places Second-quarter sales rose 16% year-over-year to $586 million. Analysts were looking for $567 million. Earnings rose 23% to $4.57 per share. Here, the consensus stopped at $3.98 per share. The company shipped 118 da Vinci systems, up from 96 in the year-ago period. Robot-assisted surgery procedures increased by 14% worldwide. Management originally expected no more than 10% procedure growth in 2015. Again... crushing it. The da Vinci Xi, ready to operate. Image source: Intuitive Surgical.
9. 9. Finally, Amazon.com jumped as much as 22.6% on Friday alone, thanks to another fantastic Q2 report.
10. 10. What's Amazon doing here? Amazon grew sales 20% year-over-year to $23.2 billion, far ahead of the Street's $22.4 billion consensus. Analysts expected a $0.14 net loss per share. Amazon delivered a $0.19 profit per share instead. Amazon Web Services, the cloud-based technology services division, grew sales by 82% and increased operating profits fivefold. That division now accounts for a modest 8% of Amazon's overall revenue but 36% of the company's total segment operating income. Is online retailer Amazon also a tech company? Absolutely, with AWS results like these.
11. 11. Isn't Amazon too darn expensive? Despite the surprising lack of red ink on the bottom line, Amazon owners can still look back at $0.43 of trailing net losses per share and therefore no trailing P/E ratio at all. The stock remains pricey by traditional metrics, trading at 185 times forward earnings estimates and 21 times book value. However, Amazon has produced $4.4 billion of free cash flow over the last four quarters -- an all-time record:
12. 12. A little-known tech company responsible for finally putting an end to credit cards could hand its investors life-changing profits. And a revealing investor alert from The Motley Fool has the full story!