General Electric's (NYSE:GE) $22.60 reaffirming of guidance for 2002 and an upgrade of IBM (NYSE:IBM) $57.58 by Lehman Brothers has stock futures building to their best levels of the morning and indicating a higher open for stocks.
Shares of General Electric rose 80 cents to $23.40 after the company reported Q3 EPS of $0.41, which was in line with analyst's estimates. Revenues rose 11% to $32.6 billion versus consensus of $31.7 billion. GE then reaffirmed its full-year earnings per share target of $1.65.
Lehman's Dan Niles upgraded share of Dow component IBM (IBM) to "overweight" from "equal weight" on belief that concerns over the IT spending environment are overdone, as are worries over pension and stock options. Analyst Dan Niles feels that IBM's (IBM) third-quarter earnings are "in line" and that stability in the U.S. is offsetting European weakness. Niles said IT spending should improve slightly in 2003 and that any estimate cuts should be modest. Shares of IBM jumped $3.29 to $60.87 over the New York ECNs. Lehman Brothers went on to say that IT spending is being depressed by the prospect of war.
Shares of semiconductor giant and Dow component Intel (NASDAQ:INTC) $14.19 edge up 21-cents to $14.40 over Instinet despite UBS Warburg cutting its 2003 EPS estimate to $0.74 from $0.80 and reduces its price target to $18 from $26. Salomon Smith Barney is also cutting estimates on INTC and trimmed their 2003 estimates to $0.70 from $0.79 and price targets to $20 from $25. Current consensus from as polled by Multex is for INTC to earn $0.76 for fiscal year 2003.
Stock futures are near their best levels of the session with S&P futures (sp02z) trading up 12.4 points at 814.90. NASDAQ futures (nd02z) are higher by 17 points at 866 and Dow futures (dj02z) are gaining 115 points to 7,620.
Fair value for the S&P 500 today is $0.42. That price will not change during the session. HL Camp & Company has their computers set for program buying at $1.52 and set for program selling at $-2.28. Fair value for the NASDAQ-100 today is $2.75.