Diamonds and Dogs

3/4/16

Keeping us all connected is the job for our diamond, Broadcom (AVGO). The designer, developer and supplier of digital semiconductor connectivity solutions is jumping 7% closing in on its 52 week high after reporting better than expected earnings. The Singapore based company earned $1.30 per share compared to $1.26 a share a year ago.  Revenue increased 8.3% year over year. Gross margins for the quarter improved to 53% from 51% a year ago. With three upgrades with $185, $180, and $185 price targets, Broadcom may have a way to go.

Tax season is here, but today's dog should be raking it in. H&R Block (HRB) is tumbling 16% to a new 52 week low on disappointing earnings and less than stellar guidance. The tax preparing company typically reports quarterly losses except for the three-month period from February to April, otherwise known as tax season. That's when the company generates 70% of its revenue and nearly all of its profits. But this year the numbers will be light of expectations due to the divestiture of H&R Block Bank, foreign exchange issues, as well as lower client volumes in its U.S. assisted tax offices. A wave of free, online tax-filing options has heightened the competition facing H&R Block and other tax preparers.