Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.
As the Federal Reserve concludes its October two-day policy meeting today, investors seem somewhat cautious about whether or not the central bank will begin to let interest rates increase. However, most analysts, economists, and institutional investors expect the Fed to stay the course. But that positive attitude is slightly missing on Wall Street today, as the Dow Jones Industrial Average (DJINDICES: ^DJI ) is flat as of 1 p.m. EDT, while the S&P 500 is off by 0.13% and the NASDAQ is down 0.23%.
The markets may be calm, but we're still in the middle of earnings season, and numerous companies continue to report every day. So let's take a look at a few that reported this morning and see what's causing shares prices to fluctuate today.
Buffalo Wild Wings (NASDAQ: BWLD ) reported quarterly earnings of $0.95 per share on revenue of $315.8 million, while analysts had only been expecting sales of $311.6 million and profit of $0.85 per share. Sales rose 27.9% from the prior-year quarter, while same-store sales growth was up 4.8% at owned properties and 3.9% at franchised locations. The company said lower chicken prices helped with the earnings beat, but regardless of lower costs, the company crushed it on sales. That good news has sent shares of the restaurant higher by 7.8% at this time. The company is doing nearly everything right, and thus shares are up big.
Gorilla Glass manufacturer Corning (NYSE: GLW ) is down 1.7% after the company reported third-quarter earnings. Revenue came in at $2.1 billion, while earnings per share hit $0.33, beating respective expectations of $2.09 billion and $0.32. However, the company told investors that management expects Q4 revenue to decline slightly from the prior-year quarter due to the seasonal nature of the display business. Although analysts expected this, investors never want to see revenue fall year over year, because that's supposed to remove seasonal fluctuation.
Shares of Garmin (NASDAQ: GRMN ) are down a modest 0.4% after the company also reported results. Profit rose 33.7% from the same quarter last year to $187.6 million, or $0.96 per share, but revenue fell 4% to $643.6 million. Analysts were expecting EPS of $0.59 on sales of $628.9 million. So again, while expectations were beaten, a revenue decline is likely one thing worrying investors this afternoon.
What's important to notice with all three companies highlighted here is that when a company beats on sales and revenue expectations, that doesn't mean the stock will move higher. Investors often put too much faith in analysts' opinions and expectations, missing other important factors that are more likely to drive the share price in the long run.
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