Category: Stock Market News

Ulta Salon Cosmetics & Fragrance Inc. shares weakened in the extended session Thursday after the beauty-products retailer’s third-quarter outlook offset a solid earnings beat in the second quarter. Ulta shares, which dropped by as much as 4% after hours, were last down 1% at $268.74. The company forecast third-quarter earnings of $1.25 to $1.30 a share on revenue of $1.07 billion to $1.09 billion. Analysts surveyed by FactSet expect earnings of $1.30 a share on revenue of $1.08 billion. For the second quarter, Ulta reported earnings of $1.43 on revenue of $1.07 billion. Analysts had estimated $1.40 a share on revenue of $1.06 billion.

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Splunk Inc. announced better-than expected earnings Thursday afternoon and raised its forecast for full-year revenue, but shares still took a hit in late trading. The big-data software company said it lost $86.6 million, or 65 cents a share, on revenue of $212.8 million; after adjustments for stock-based compensation and other factors, Splunk claimed a profit of 5 cents a share. Analysts on average expected Splunk to report adjusted earnings of 3 cents a share and revenue of $200.5 million, according to FactSet. With the revenue beat, Splunk pushed its guidance for full-year sales higher, forecasting $910 to $914 million after previously stating sales would come in at $892 million to $896 million. Splunk shares still fell, however, possibly indicating hopes for a bigger earnings beat. The stock, which closed with a 1.4% gain at $65.10, fell more than 5% to less than $62 in immediate late trading after the report.

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Shares of ITT Educational Services Inc. plunged 35% toward an all-time low, prior to a trading halt, after the U.S. Department of Education dropped the hammer on the for-profit education company. After ITT “failed to address” accreditor’s concerns last week, the DOE said it will no longer allow ITT to enroll students with federal aid. The company is also now required to increase the amount of cash reserves its sends the DOE, and the DOE is ending its installment payment plan for the amount previously required. In addition, the DOE said it is “slowing down” when ITT receives student aid from the government, “to ensure that ITT is handling its finances properly.” The stock, which was originally halted for volatility, and is now halted for news, had lost 62% year to date, while the S&P 500 has gained 6.2%.

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Oil futures briefly pared gains ahead of the session’s conclusion on Thursday. Reuters reported that Saudi Energy Minister Khalid al-Falih told the news agency in an interview that he does not believe any significant intervention in the oil market is necessary. His reported comments come ahead of an informal meeting of the Organization of the Petroleum Exporting Countries late next month, during which major oil producers are expected to discuss a potential production freeze. Oil “saw a dip after the headlines, but his words were measured,” said Phil Flynn, senior market analyst at Price Futures Group. The market may believe that the talk will “allow for some latitude,” Flynn said. October WTI crude was last up 22 cents, or 0.5%, to trade at $46.99 a barrel on the New York Mercantile Exchange after a dip to a low around $46.84 following the Reuters report.

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Shares of CVS Health Corp. and Express Scripts Holding Co. dropped sharply in midday trade Thursday, amid concerns that the backlash that Mylan N.V. was experiencing over the surge in EpiPen prices would spill over the pharmacy benefit managers. Analyst David Larsen at Leerink Partners said the fact that Mylan Chief Executive Heather Bresch said in a CNBC interview that the reason there is a large discrepancy between what Mylan charges for EpiPens and what they net is because of all the hands that it has to go through before it gets to the patient, “obviously implies” that CVS and Espress Scripts “are reaping significant profits” from EpiPen. Therefore, any pressure on Mylan should weigh on CVS and Express Scripts. That said, Larsen recommends investors buy CVS shares on the weakness, as the company is likely to benefit a generic EpiPen is launched. CVS’s stock shed 2.5% and Express Scripts shares slid 4.1%. Meanwhile, Mylan’s stock was up 0.7%, but had been up as much as 4.5% earlier, after the drug maker announced an expansion in eligibility for EpiPen financial assistance.

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Shares of St. Jude Medical Inc. slumped as much as 6% in morning trade Thursday, before paring some losses, after short-selling firm Muddy Waters Capital said it was betting against the cardiovascular medical device maker. Muddy Waters Director of Research Carson Block wrote in a research note that he believes “there is a strong possibility” that nearly half of St. Jude’s revenue is about to disappear for about two years. He believes the company’s pacemakers, ICDs (implantable cardioverter-defibrillatosr) and CRTs (cardiac resynchronization therapy devices) could, and should, be recalled and remediated, amid concerns over the ease in which cyber attacks could cause malfunctions. The devices represent about 46% of 2015 revenue. “Based on conversations with industry experts, we estimate remediation would take at least two years,” Block wrote. “Even lacking a recall, the product safety issues we present in this report offer unnecessary health risks and should receive serious notice among hospitals, physicians and cardiac patients.” Despite the selloff, the stock has still run up 28% year to date, while the S&P 500 has gained 6.6%.

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Natural-gas futures pared some of their gains on Thursday after the U.S. Energy Information Administration reported that supplies of the commodity rose 11 billion cubic feet for the week ended Aug. 19. That was slightly below the average rise of 18 billion cubic feet expected by analysts polled by S&P Global Platts. Total stocks now stand at 3.350 trillion cubic feet, up 275 billion cubic feet from a year ago and 350 billion cubic feet above the five-year average, the government said. September natural gas climbed 1.3 cents, or 0.5%, from Wednesday’s settlement to $2.809 per million British thermal units. It traded at $2.866 before the data.

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U.S. stocks opened lower on Thursday as investors worried that a batch of strong U.S. data could encourage Federal Reserve Chairwoman Janet Yellen to raise interest rates sooner than previously expected. Stocks added to losses from the prior session, with the S&P 500 index shedding 2 points, or 0.1%, to 2,172. The Dow industrials fell 20 points, or 0.1%, to 18,463, trading below its lowest closing level since early August. The Nasdaq Composite Index fell 9 points, or 0.2%, to 5,208.

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Amazon.com Inc. said Thursday that it has launched a car research and automotive community, Amazon Vehicles, an extension of the Amazon Automotive store. Visitors can read customer reviews for new and classic cars, view photos and videos, learn specifications, and gather information about parts and accessories, the e-commerce giant said in a release. Features include pages containing details about thousands of car models, read reviews and write to car owners, and shop. Amazon shares are down 0.3% in premarket trading, but up 62.4% for the past year. The S&P 500 Index is up 16.5% for the last 12 months.

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Shares of Mylan N.V. surged in premarket trade Thursday, putting them on track to snap a four-session losing streak, after the company succumbed to public pressure by saying it would cut costs for EpiPens. The stock had tumbled 9.9% over the previous two sessions, and 12.5% over the last four, after Congress questioned the company’s reasoning behind the sharp increase in EpiPen pricing over the years. The stretch of losses were the biggest since the stock lost 17% in the two days ending Feb. 12, and 15% over four days ending Feb. 16. Bernstein analyst Aaron Gal said there is potential for “real damage” to Mylan from all the media attention, as he believes it will put pressure on the Food and Drug Administration to enable a more competitive market. Currently, Teva Pharmaceutical Industries Ltd.’s generic version of the EpiPen could be mid-2017, Gal said. Through Wednesday, Mylan’s stock had tumbled 20% year to date, while the SPDR Health Care Select Sector ETF had tacked on 1.9% and the S&P 500 had gained 6.4%.

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