Diamonds and Dogs
Time to go shopping with today's diamond. Amazon.com (AMZN) is surging 9% to a new all-time high following blow out earnings. Sales grew 28% to $29.1 billion in the first quarter, compared to a forecast of $27.99 billion. Earnings per share were $1.07, greatly exceeding Wall Street's expectations of 58 cents per share. Going forward, sales and earnings are set to accelerate while the company is looking to expand into other business segments like online video streaming that is currently dominated by Netflix with very little competitors. Thanks to the surge in the stock price, CEO Jeff Bezos net worth grew by over $5 billion overnight.
Not a good time to be a shareholder in disk driver and data storage. Western Digital (WDC) and Seagate (STX) are getting clobbered down 13% and 19% respectively following lackluster earnings. Western Digital earnings missed estimates while revenue dropped over 20% year over year. The company also lowered future guidance. Seagate produced similar results pushing their dividend yield up over 11%. The business of disk drives is known for being cyclical. Let's hope the industry sees an upturn sooner rather than later.