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Stock Market Today: Disney's Layoffs and Sirius XM's $1 Billion Quarter

By Demitri Kalogeropoulos - Feb 4, 2014 at 9:00AM

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Why Disney, Sirius XM, and International Paper stocks are on the move today.

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

So far, 2014 has been a blunt reminder that stocks can be volatile: yesterday's 300-point drubbing was the second fall of that magnitude in this young year, compared to just one such daily drop in all of 2013, and only one in 2012. Of course, stock price swings are irrelevant to a company's underlying business and can present buying opportunities for long-term investors. In fact, it appears buyers are returning to the stock market today, as the Dow Jones Industrial Average (^DJI 0.03%) gained 41 points in premarket trading this morning.

Meanwhile, news is breaking on several stocks that could see heavy trading in today's session, including Disney (DIS -0.70%), Sirius XM Radio (SIRI 1.15%), and International Paper (IP -0.71%).

Disney is set to lay off hundreds of people at its interactive gaming division, according to The Wall Street Journal. That unit has been the company's only business line to consistently lose money over the last five years, including $87 million in Disney's fiscal 2013. Still, the business turned a profit last quarter, thanks to the successful introduction of the new video game Infinity, which has held up well against Activision Blizzard's profitable Skylanders franchise. Investors should learn more about Disney's digital plans tomorrow when the entertainment giant reports quarterly earnings results. Disney's stock is up 1.4% in premarket trading.

Sirius XM today posted fourth-quarter earnings results in which sales jumped by 12%, to reach a record $1 billion. Profit came in at $0.01 a share, slightly below estimates, as a significant drop in subscriber acquisition costs was overwhelmed by a spike in the company's revenue sharing and royalty expenses. Still, Sirius affirmed its overall guidance for 2014, saying it expects to book $4 billion in revenue and 1.25 million net subscriber additions. The stock is up 0.3% in premarket trading.

Finally, International Paper today announced quarterly earnings results that were below analysts' estimates. Sales clocked in at $7.2 billion, while Wall Street had expected $7.4 billion. Operating profit also came in surprisingly low, at $0.83 a share. The company's industrial packing profit fell as a shorter shipping quarter and a seasonal demand dip hurt sales volumes. International Paper's stock is down 0.24% in premarket trading.


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Stocks Mentioned

Dow Jones Industrial Average (Price Return) Stock Quote
Dow Jones Industrial Average (Price Return)
$31,261.90 (0.03%) $8.77
Sirius XM Holdings Inc. Stock Quote
Sirius XM Holdings Inc.
$6.16 (1.15%) $0.07
The Walt Disney Company Stock Quote
The Walt Disney Company
$102.42 (-0.70%) $0.72
International Paper Company Stock Quote
International Paper Company
$47.48 (-0.71%) $0.34

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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