Nothing to Chirp About at Twitter; Lumber Liquidators Earnings Nearly Hit the Floor; Ben Bernanke’s Impressive Resume

Chirp…

Image courtesy of Mr-Vector7/FreeDigitalPhotos.net

Image courtesy of Mr-Vector7/FreeDigitalPhotos.net

What’s worse? Having your earnings leaked prematurely or the fact that those earnings were so bad? Hmmm. This one’s a toss up. Either way, Twitter’s bummed on all ends. Earnings reports are released only after the closing bell or right before the opening bell giving traders/investors/wannabes a chance to study the numbers and figure out how to proceed. Twitter’s “inadvertently” pre-maturely released earnings, which occurred on its very own platform, sent the stock south 20% and even caused trading of the stock to be suspended for a period. But that was only Twitter’s second worst day ever.  As for the horrible numbers, sales are actually up 74% over the previous year but the problem – and it’s a big one – is that Twitter’s growth rate is not up. User growth grew 18% to 302 million active users. But last month it grew 20%. Those figures are only supposed to go up. Never down. And herein lies one of social media company’s many many problems. Another is that CEO Dick Costolo’s credibility has come under fire and here’s why: It seems he didn’t see the writing on the wall, namely that all signs were pointing to a major slowdown.

Floor-ed…

Image courtesy of Serge Bertasius Photography/FreeDigitalPotos.net

Image courtesy of Serge Bertasius Photography/FreeDigitalPotos.net

Things at Lumber Liquidators keep getting worse as the company reported its first quarter earnings and to the surprise of no one, the company took a loss of $7.9 million and 29 cents per share on $260 million in revenue. I have to wonder if analysts didn’t hear about the scathing “60 Minutes” report that accused the company of selling formaldehyde-laced flooring because they expected the company to at least gain 15 cents a share. To give you an idea of just how bad those earnings really are, last year at this time the company took in a profit of $13.7 million and 49 cents a share. In case you were wondering how the company even made any money this quarter, most of it comes from January and February, before the damning piece even ran on March 1. Much of those losses are because of all those legal and professional fees the company has been shelling out to defend itself. But it’s safe to assume that people also are probably not buying from a company that would allow toxins to make their way into the company’s products. And the trouble just keeps coming. Lumber Liquidators says it is aware of the over 100 pending class action lawsuits against it. Even the Department of Justice has entered the fray seeking criminal charges against the company under the Lacey Act. Oh and one more thing, its CFO, Daniel Terrell, needs to brush up his resume as he’s leaving the company.

Ben…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Ben Bernanke’s LinkedIn profile seems to be filling up nicely. First he took a position as a distinguished fellow in residence at the Brookings Institution. Then he picked up a consulting gig at hedge fund, Citadel. Now, the former Federal Reserve Chairman has some new West Coast digs, thanks to PIMCO, who just announced that Mr. Bernanke would be joining its ranks as a senior adviser. PIMCO could definitely use Mr. Bernanke’s guidance right about now as investors have pulled about $100 billion from the fund following the departures of Co-Chief-Investment Officers, Bill Gross and Mohamed El-Erians last year. The former fed chairman will still have plenty of cash to play with as PIMCO handles about $1.59 trillion and runs the world’s biggest mutual fund. He’ll even get to “engage” with clients, which should help win back some of that $100 billion and assuage the fears of those finicky investors.

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