How to put a good spin on bad news (bankruptcy, 2009, sell)

[HappyTexan]

So Intel came out with 1Q earnings today.
If you just read the headline then you'd see "Intel result beats forecast".

Happy news right ?

So now read all the article and see the numbers.
1Q08 they reported $.25/share
1Q09 they reported $.11/share

Down 55% 08 to 09

Revenue was down 26% from last year.

Forecasters had revised their estimates down to $.03/share for Intel.
Gee that bar was lowered almost to the ground and it would pretty hard not to beat that and if they didn't they'd probably be near bankruptcy.

So is it really happy news ? Analysts were expecting Intel to go from $.25 per share down to $.03 per share and the fact that Intel's earnings only dropped 45% rather than 88% is good news.

Article with the numbers:
Intel results beat forecasts, says market bottomed

Back in January analysts were estimating $.13 per share and revised downward since then.
Earnings estimates for Intel, IR, others still too high, analysts say | Electronics > Computer Equipment from AllBusiness.com


The reason I post this is not to make everyone doom and gloom but so that you are aware of what spin is being put on numbers and know this before you jump head first back into this market. Be informed before you leap.

[Woof]

Yeah, it's funny how the stock market went berserk last week when some of the news wasn't quite as dire as expected!

Maybe funny is not the right word ...... sad, perhaps?

[chet everett]

It is to be expected. If people "mentally prepare" for the worst and then a BAD thing happens, but NOT the "worst" thing there is "relief".

Truly "good news" is still a long way off, but for the next 3-6 months I think anytime that any news comes through that, like the Intel announcement, is NOT "worse than forecasts" there will be POSITIVE reactions.

A marked change in the pronouncement from the WH has already happened -- no longer are we being warned of "dire consequences" , instead we are hearing things like "this is the right think to do" or "this will position us better for the future". The message makers know they have "broken the gong" on the alarm bell and they played this 'crisis' all they could.

Personally I feel that there are signs of "over correction" in many areas and, while we are not out of all danger, there is a better chance of things moving to the slightly positive or barely declining than any of the wild "express train to the subbasement" movements that were all too common.

With improving weather, attractive financing, and a pretty diverse inventory of homes I suspect existing homes sales should rebound pretty well, as long as wage declines are not wide spread.

Similarly I suspect that people are going to take advantage of SOME retail bargains, in not-so-trendy products so that they get some lasting value. That may include a shift away from the "luxury" goods in some sectors, where fashions change, but "luxury" goods that have a record of LASTING a long time will be in strong demand.

I suspect that if you go to a mall that will mean that some trendy shops will simply shut down, while some stores that sell goods that are every bit as costly, but will provide a much longer service will do OK.

Even in "technology" centric areas I suspect this is happening. I have seen MSFT running ads with "shoppers" looking for the best value in PCs. ( I happen to disagree with the commercials premise, as I know that OS X is built on a BSD Unix base and as such is much older and more stable than XP/Vista/Windows 7, but commercials in the US don't have to be truthful...).

I think that GM is going to have a hard time turning things around, as their really long lead time means that they have "fun" cars hitting the showrooms (like the Camaro) instead of something "practical" like Honda's new Prius inspried hybrid. Ford is only slightly better off, but they do not have the nightmare of the forest of brands that GM is struggling with. Hummers are ridiculous. GMC truck is incredibly redundant. Pontiac is far too frivoulous. Saturn utterly failed to win a place as the affordable offering with Japanese-style reliably/economy. Buick only has three offerings. Saab is a wasted idea, that could have been the smaller more technologically advanced alternative that would have been sqaurely in the "high value" area if GM did not mess them up. Chevy ranges from the insanely powerful and costly limited edition ZR-1 Corvette to cars so puny and junky (Aveo) that the Korean makers do not even offer the clones, far too broad a line-up.

Some of these problems are going to drag on and on ...

[texdav]

Basically intell is in pretty good shape to whether the recession.Its alot of the other that are likely to disappear like Gm and Chrysler that worries people more.People are just waiting to see how heavy the shoe will drop with those two.

[subsound]

Always give out the news with a big meal and free booze. Everything will look good till the people recover...especially with a company that is not going down in flames like Intel (yet). With the car companies I think you would need something stronger to make people optimistic on such bad news.