In the news this morning, Bank of American and Citigroup report quarterly results, Boeing's Dreamliner nightmare keeps getting worse, Rio Tinto is taking a big charge and replacing its CEO, the Dell buyout may be getting closer and earnings from eBay and UnitedHealth.
Bank of America
Bank of America (BAC) reported earnings of 3 cents per share for the fourth quarter, edging out estimates for 2 cents per share. Adjusted revenue was $19.6 billion, compared to analyst estimates for $21.2 billion. The company had previously warned that the quarter would include a number of one-time charges, including more than $5 billion in charges related to mortgages, a $1.3 billion and a $700 million charge related to increases in the value of the company's debt.
The original financial supermarket, Citigroup ©, reported fourth-quarter earnings of 38 cents per share, and “core earnings” of 69 cents per share. Analysts expected earnings of 97 cents per share. Revenue was $18.2 billion, or $18.7 billion adjusted for one-time items. Analysts expected Revenue of just below $19 billion.
The ongoing issues with Boeing's (BA) 787 Dreamliner are turning into a nightmare for the company after the FAA grounded U.S. registered jets. Airlines in Europe, Japan, Qatar and India followed suit as the company and regulators are investigating issues with some batteries on the jets. At least one airline, Poland's LOT, said it will seek compensation from Boeing in connection with its two grounded jets. The FAA said carriers would have to demonstrate that the batteries are safe before the planes will be allowed to fly again. The regulator did not provide a timetable.
Media reports this morning have Silver Lake Management LLC and others close to arranging the $15 million in funds needed to take Dell (DELL) private. Credit Suisse, Royal Bank of Canada, Barclays and Bank of America may disclose terms of a bridge loan to a small group of buyers as soon as Thursday and a deal could be announced as soon as next week.
Online auctioneer eBay (EBAY) reported adjusted fourth-quarter earnings of 70 cents per share, beating the mean analyst estimate for 69 cents. Revenues of $3.99 billion edged out estimates for $3.98 billion. The company said it expects revenue of $16 billion to $16.5 billion for 2013 and earnings of $2.70 to $2.75 per share. Analysts had expected revenue of $16.3 billion and profit of $2.74 per share.
Insurer UnitedHealth Group (UNH) reported fourth quarter earnings of $1.20 per share on revenue of $28.77 billion. Analysts had forecast earnings of $1.20 per share on revenues of $28.33 billion. The company forecast 2013 earnings of between $5.25 to $5.50 per share, compared to estimates for $5.56 per share.
Mining giant Rio Tinto (RIO) will take a $14 billion write-down in connection with it aluminum business and the acquisition of a coal company in Mozambique. The company also said CEO Tom Albanese, and Doug Ritchie, who was responsible for the coal-company deal, are leaving by “mutual consent”. The pair will stay until July 16 to help with the transition. The head of the company's iron ore division, Sam Walsh, will take over as CEO.