The stock market was open for business on Wednesday morning, but many investors got an early start to the Thanksgiving holiday. As of 11 a.m. EST, the Dow Jones Industrial Average (DJINDICES:^DJI) was unchanged at 28,122. The S&P 500 (SNPINDEX:^GSPC) rose 7 points to 3,147, and the Nasdaq Composite (NASDAQINDEX:^IXIC) moved higher by 38 points to 8,686.
The holiday-shortened week hasn’t generated a huge amount of news, but investors are still following some compelling storylines at some key individual companies. HP (NYSE:HPQ) gave its latest financial report but stayed relatively tight-lipped about a recent takeover bid. Boeing (NYSE:BA), meanwhile, got a reminder that when it comes to its grounded 737 MAX aircraft, the Federal Aviation Administration will have the last word about what’s next for the aerospace and defense giant.
HP finishes fiscal 2019 on a high note
Shares of HP were down 1% Wednesday morning after the tech company released its fiscal fourth-quarter financial results. The printer and hardware specialist delivered some good news for the quarter, but it largely stayed mum on the bid that smaller rival Xerox (NYSE:XRX) recently made to buy HP.
Image source: HP.
HP’s numbers were largely better than expected. Revenue for the quarter inched up 0.3% from year-earlier levels, helping to lift adjusted net income 4% year over year. A substantial decline in shares outstanding pushed adjusted earnings per share higher by 11% over the same period. Revenue from the printing segment was down 6%, but personal systems sales climbed 4% on strength in the company’s commercial business.
Yet there wasn’t a huge amount of discussion about Xerox’s plans to acquire HP. After Xerox made the initial offer in early November, HP rejected the buyout, but it did leave the door open to further negotiations and discussions. In the conference call, HP executives made it clear they wouldn’t expand on previous comments about the potential Xerox deal. That could signal either that there’s nothing yet to say or that discussions are still ongoing without having reached resolution.
HP’s stock hasn’t really gone anywhere over the past couple of years, and restructuring efforts have been slow. Solid numbers are a positive for the business, but it’ll take a lot more for HP to get back all of its past upward momentum.
The FAA takes the controls
Shares of Boeing dropped 1% as investors tried to assess new comments from the FAA regarding the 737 MAX aircraft model. Despite hopes that the 737 MAX might return to service in the next couple of months, the latest news suggests further delays are possible.
The FAA plans to take sole responsibility for issuing airworthiness certificates for 737 MAX aircraft, changing its past practice of sharing that responsibility with Boeing. That could mean that FAA officials would look at each individual aircraft before Boeing delivers it to the aircraft manufacturer’s respective customers. The regulatory agency plans to use that process at least as long as necessary to make sure Boeing’s quality control is adequate.
The move comes amid tension about how long Boeing will have to wait to get the 737 MAX off the ground. The aerospace company had recently said it hoped to have certification work happening before year-end. Yet airlines remain skeptical, with many keeping the MAX off their schedules until March at the earliest.
Boeing wants to get the 737 MAX issue resolved as quickly as it can, hopefully before nervousness among would-be customers leads to any changes in order flow. But having faced criticism for its initial process in certifying the aircraft, the FAA seems loath to make what some see as the same mistake twice in rushing the MAX back to service.