Diamonds and Dogs

2/2/15

Look fancy while your share price rise with today's diamond, Michael Kors (KORS). Michael Kors, the luxury fashion and apparel specialist, is jumping 25% following better than expected earnings. Quarterly revenue came in up 6.3% year over year (9.9% at constant currency) to $1.4 billion. Net income declined 3% to $294.6 million. The numbers would've been worse if not for share repurchases over the past year, including 4,682,121 shares repurchased for roughly $200 million during the quarter. Business was not spectacular, but with the stock down 50% in the last year, it didn't take much to impress shareholders. 

Not a good day to disappoint Wall street. Integrated Device Technology (IDTI) is the dog today down 26% following earnings. The earnings were actually better than expected. Revenue rose 17.5% year over year to $177.6 million while adjusted net income rose 35% to $52.2 million. The disappointment came with guidance, specifically for the current quarter, as Integrated Devices anticipates revenue of $187 million, plus or minus $5 million, representing 18% growth over the same year-ago period, but below estimates. Maybe in a different market the stock wouldn't have dropped as much, but this market is not kind to disappointing guidance.