Diamonds and Dogs
Open sesame. Alibaba (BABA) is jumping 5% to a new 52 week high following better than expected earnings. The Chinese Internet company reported earnings of 74 cents per share, 11 cents better than expectations. Revenue grew 59% to $4.84 billion. The China retail marketplaces revenue grew 49% year-over-year while Chinese mobile revenue increase of 119% year-over-year. Maybe the Chinese economy is coming back to life.
Not a good day for all. Shares of plastics producer A. Schulman (SHLM) dropped as much as 34.7% today after the company lowered full-year guidance. Management said it expects 2016 adjusted net income to be $1.90 to $1.95 per share, down from a previous estimate of $2.40 to $2.45 per share. Weakness in key end markets of the U.S. and Europe appeared during the second quarter, and has continued into this month, causing the guidance reduction. While earnings will be down, management pointed out that cash flow continues to be strong and that they're paying down debt with that cash.