Category: Stock Market News

Shares of Valeant Pharmaceuticals International Inc. surged 3.7% in premarket trade Thursday, after the drugmaker said lenders approved an amendment to its credit facility, to allow more financial flexibility. As part of the agreement, Valeant agreed to increase interest rate margins on its credit facility by 0.50% and to pay an amendment fee equal to 0.25% of the total principal amount. Other amendments include additional flexibility to sell assets, to permit the issuance of secured notes with shorter maturities to repay debt, to permit issuing other debt to repay term loans and the cut the interest coverage maintenance covenant to provide additional headroom. “We are pleased to have the support of our lenders and appreciate their confidence in the company’s future,” said Chief Executive Joseph Papa. The stock, which had soared 20% so far this week through Wednesday, had still tumbled 70% year to date, while the S&P 500 had gained 6.8%.

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Dick’s Sporting Goods Inc. was downgraded to neutral from buy at Goldman Sachs on concerns surrounding share gains the retailer will make following The Sports Authority’s bankruptcy. Goldman Sachs removed Dick’s from its Conviction List and lowered the price target to $56 from $61. “Second quarter results already included a net benefit from The Sports Authority – notably late in the quarter – in the final weeks of The Sports Authority’s going-out-of-business sales as the ‘good stuff’ had been liquidated early on, per Dick’s,” analysts wrote in a Wednesday note. “It is only now going through The Sports Authority’s customer lists, and hopes these efforts will bear fruit in the fourth quarter with some potential help in the third quarter.” There’s uncertainty around share gains from the back-to-school season, and Goldman analysts “see upside to the stock as more limited from here.” Dick’s shares are inactive in premarket trading, but up 63% for the year to date. The S&P 500 Index is up 6.8% for the year so far.

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Auris Medical Holding AG shares slumped 54% Thursday, after the company said a trial of a treatment for inner ear tinnitus failed to meet its goals. The Zug, Switzerland-based company said the TACTT2 trial with Keyzilen(TM) for acute inner ear tinnitus missed its primary efficacy endpoints. The company is still reviewing the data. “We plan to complete this analysis and meet with the regulatory agencies prior to the TACTT3 readout, which is expected in the fourth quarter,” Chief Executive Thomas Meyer said in a statement. The company is on track with a separate late-stage trial of AM-111 for the treatment of acute sensorineural hearing loss, which is in the enrollment stage. The company said it has enough cash and cash equivalents to fund operations through year-end 2017. Shares have gained 9% in the year through Wednesday’s close, while the S&P 500 has gained about 7%.

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Oil producer Continental Resources Inc. said Thursday it has signed a deal to sell non-core assets in North Dakota and Montana for $222 million, The sale includes about 2,800 barrels of oil equivalent per day. Chief Executive Harold Hamm said the sale is the third of non-core assets this year with overall proceeds expected to total $600 million. “We plan to apply proceeds to reduce debt and strengthen our balance sheet,” he said in a statement. Shares were not yet active in premarket trade, but are up 106% in the year so far, while the S&P 500 has gained about 7%.

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Wal-Mart Stores Inc. shares rose 3.5% in Thursday premarket trading after the retail giant reported second-quarter earnings that exceeded estimates. Net income was $3.77 billion, or $1.21 per share, up from $3.48 billion, or $1.08 per share for the same period last year. Adjusted earnings were $1.07, beating the $1.02 per share FactSet consensus. Revenue totaled $120.85 billion, up from $120.23 billion and beating the $120.17 billion FactSet consensus. Same-store sales at Walmart U.S. rose 1.6%, beating the FactSet consensus of 1%. Wal-Mart now expects fiscal 2017 adjusted EPS of $4.15 to $4.35, which includes the expected operating losses and one-time expenses tied to the acquisition of e-commerce site Jet.com but excludes the non-cash gain of 14 cents net of tax from the sale of Yihaodian. The FactSet estimate is $4.27. Wal-Mart also expects same-store sales for the quarter ending Oct. 28 at Walmart U.S. to rise 1% to 1.5%. Wal-Mart shares are up 19% for the year so far while the S&P 500 Index is up 6.8% for the same period.

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Hormel Foods Corp. reported Thursday fiscal third-quarter earnings that rose to $195.7 million, or 36 cents a share, from $146.9 million, or 27 cents a share, in the same period a year ago. That beat the FactSet consensus for earnings per share of 35 cents. Revenue grew to $2.30 billion from $2.19 billion, above the FactSet consensus of $2.26 billion, as grocery products, refrigerated foods and Jennie-O Turkey Store sales all beat expectations. The packaged foods company raised its 2016 EPS outlook to $1.60 to $1.64 from $1.56 to $1.60, compared with the FactSet consensus of $1.59. “We expect to show sales and earnings growth in fiscal 2017 and will provide a more definitive guidance range on our fourth quarter conference call in November,” said Chief Operating Officer James Snee. The stock, which was still inactive in premarket trade, has dropped 8.1% year to date, while the S&P 500 has gained 6.8%.

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Just days after they were introduced, McDonald’s is pulling Step It Activity Bands from its Happy Meals after “receiving limited reports of potential skin irritations that may be associated from wearing the band.” The fitness trackers for kids were to be part of a four-week promotion in the U.S. and Canada. “It will no longer be offered as part of our Happy Meals,” a McDonald’s spokeswoman said in an email Wednesday night. “Nothing is more important to us than the safety of our customers and we are fully investigating this issue.” The fitness trackers were part of an effort by the fast-food giant to promote a healthier image.

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SolarCity Corp. said late Wednesday it would take restructuring charges this year primarily in the form of paying out severance benefits, according to a filing with the Securities and Exchange Commission. The solar-panel maker did not say how many workers would be affected but the action was to “realign the company’s operating expenses to match the company’s reduced guidance for megawatts installed.” SolarCity said it plans to spend $3 million to $5 million on the restructuring, with most of the charges in the second half of this year. The company also said that co-founders Lyndon Rive and Peter Rive, SolarCity’s respective chief executive and chief technology officer, will have their annual salaries reduced to $1 from $250,000. SolarCity shares were unchanged at $23.59 after hours.

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J. C. Penney Co. Inc. announced late Wednesday a slew of initiatives to improve profit and growth in the next few years, saying it will focus on special-size clothing; home goods, including appliances showrooms and flooring in some markets; and expand the number of Sephora stores inside JCPenney stores and its fine jewelry selection. The retailer also signaled a larger push into e-commerce. J. C. Penney said it expects a compounded annual comparable-store sales growth of 3%, and net income between $450 million and $500 million by 2019. It also set a goal of per-share earnings between $1.40 and $1.55 within three years. “Although we’ve sharpened our priorities for the next three years, our strategic framework remains the same,” Chief Executive and Chairman Marvin E. Ellison said in a statement. “Under this framework, we are taking market share, outpacing competitors and improving the long term profitability of our business.”

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Agilent Technologies Inc. shares declined in the extended session Wednesday after the laboratory equipment maker’s revenue results and forecast fell shy of Wall Street targets. Agilent shares fell 5.2% to $45.89 after hours. The company reported adjusted third-quarter earnings of 49 cents a share on revenue of $1.04 billion. Analysts surveyed by FactSet had forecast 47 cents a share on revenue of $1.05 billion. For the year, Agilent reaffirmed its guidance of $1.89 to $1.91 a share in adjusted earnings on $4.14 billion to $4.16 billion in revenue. Analysts expect $1.91 a share on revenue of $4.18 billion.

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