Category: Stock Market News

Monsanto Co. said Wednesday it still expects fiscal 2016 adjusted earnings per share to be a the “low-end” of the expected range of $4.40 to $5.10. The FactSet consensus is for EPS of $4.43. The seeds and farming services company said expectations for free cash flow for the year remains $1.3 billion to $1.5 billion. For 2017, Monsanto said it still believes EPS will return to growth, while current FactSet consensus estimates implies 12% growth to $4.96 a share. The company said Chief Executive Hugh Grant will be speaking at company’s eighth Whistle Stop tour event for investors. “Monsanto has the right strategic plan in place to create significant shareowner value over the long term, built on strong business fundamentals,” Grant said in a statement. The stock was shedding 1.7% in midday trade, putting it on course to suffer its seventh loss in eight sessions. It has gained 5.2% year to date, while the S&P 500 has advanced 6.1%.

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Oil futures cut much of their earlier losses on Wednesday after the U.S. Energy Information Administration reported that domestic crude supplies declined by 2.5 million barrels in the week ended Aug. 12. That was above to the 200,000-barrel fall expected by analysts polled by S&P Global Platts. The American Petroleum Institute late Tuesday reported a drawdown of 1 million barrels, according to sources. Gasoline supplies also declined by 2.7 million barrels, while distillate stockpiles rose 1.9 million barrels last week, according to the EIA. September crude fell 28 cents, or 0.6%, from Tuesday’s settlement to $46.30 a barrel on the New York Mercantile Exchange. Prices traded at $45.93 before the data.

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U.S. stocks traded modestly lower Wednesday as investors took a cautious stance ahead of Federal Reserve minutes that could reveal if a rate increase in 2016 is likely. The Dow Jones Industrial Average , was off 24 points, or 0.1%, at 18,528, the S&P 500 index , was 0.1% lower at 2,176, while the Nasdaq Composite Index gave up 5 points, or 0.1%, at 5,221. Minutes from the Federal Open Market Committee’s July 26-27 meeting are set for 2 p.m. Eastern Time, and will be closely pored over for signs of the timing and pace of increases to key interest rates. Additionally, St. Louis Fed President James Bullard will speak about monetary policy at the Wealth and Asset Management Research Conference at Washington University in St. Louis at 1 p.m. In corporate news, Aetna Inc. told the Justice Department that it would reduce its exposure to Affordable Care Act exchanges, known as Obamacare, if its planned merger with Humana Inc. , was blocked. Meanwhile, shares of Valeant Pharmaceuticals International Inc. were soaring, up more than 11%, after Morgan Stanley issued a bullish research report on the embattled drug maker.

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Shares of Valeant Pharmaceuticals International Inc. shot up 9.7% in active premarket trade Wednesday, after Morgan Stanley analyst David Risinger turned bullish on the drug maker, citing the belief that major risks to the company have already been priced into the stock. Risinger raised his rating to overweight, after being at in line since October 2015. He raised his stock price target to $42, which is 58% above Tuesday’s closing price of $26.60, from $27. “Risk of severe financial stress should diminish as [debt] covenants are renegotiated and [Valeant] pays down debt, and deleveraging should drive equity value accretion,” Risinger wrote in a note to clients. Regarding risks of drug pricing resets, Risinger said Valeant has already experienced step downs in net pricing and access, and he his valuation estimates already account for generic competition for the company’s most controversial drugs–Isuprel and Nitropress–over the next six to 12 months. The stock, which was on course to open at a 2 1/2-month high, had plunged 74% year to date through Tuesday, while the SPDR Health Care ETF had tacked on 3.1% and the S&P 500 had gained 6.6%.

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Lowe’s Cos. will likely spend time talking about second-quarter sales on its earnings call Wednesday morning after revenue missed FactSet estimates, according to Credit Suisse. The home improvement retailer reported $18.26 billion in sales, missing the $18.44 billion consensus. “Sales is probably what matters most here, and that will be the focus for the call, including if there were any usual trends or shifts that may have occurred,” analysts wrote in a note. Both Lowe’s and Home Depot Inc. reported an earnings lift from outdoor sales in the first quarter. “Results likely indicate that Lowe’s benefited more from seasonal trends in the first quarter, when it delivered significant upside to comps,” Credit Suisse wrote. “Pull forward, plus less favorable weather in the second quarter for Lowe’s may have impacted results.” Analysts say they’ll be listening for weather impact, the impact of the acquisition of Canadian home improvement retailer Rona Inc. and discussion of gross margins, which were expected to expand. Lowe’s shares are down 4.6% in premarket trading, but up 12.4% for the past year. The S&P 500 Index is up 3.6% for the last 12 months.

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The Madison Square Garden Co. said Wednesday it has acquired a 12% stake in Townsquare Media Inc. , a digital marketing company with a portfolio of radio stations, digital assets and live events. MSG said the two will cooperate in bookings, sponsorship and marketing, and will expand Townsquare’s live events business. The deal gives MSG a foothold in the festival business, which it has been exploring, the company said in a statement. MSG bought about 3.2 million shares of GE Capital’s Class C common stock, which represents a roughly 12% common equity interest in Townsquare. The stock converted to Class A shares on closing. MSG shares were not yet active in premarket trade, but are up 15% in the year to date, outperforming the S&P 500 , which is up 6.6%.

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Performance Sport Group Ltd.’s stock tumbled 6.7% in premarket trade Wednesday, after the sports equipment and apparel maker disclosed in a filing that it is the subject of inquiries by U.S. and Canada regulators. The company said the inquiries include an investigation by the Securities and Exchange Commission. Earlier this week, the company said it would miss the deadline to file its annual report, because of an internal investigation into the finalization of its financial statements, which could result in a default under its current credit facilities’ agreements. The stock had plunged 78% year to date through Tuesday, while the S&P 500 had gained 6.6%.

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Target Corp.’s stock dropped 3.3% in premarket trade Wednesday, after the discount retail giant reported a fiscal second-quarter profit that beat expectations but provided a downbeat outlook. For the quarter ended July 30, earnings fell to $680 million, or $1.16 a share, from $753 million, or $1.18 a share, in the same period a year ago. Excluding non-recurring items, such as early debt-retirement losses, adjusted earnings per share came in at $1.23, above the FactSet consensus of $1.13. Revenue fell 7.2% to $16.17 billion, matching the FactSet consensus. Same-store sales declined 1.1%, compared with the FactSet consensus of a 0.9% decline. Looking ahead, Target expects third-quarter adjusted EPS of 75 cents to 95 cents, compared with the FactSet consensus of 96 cents. For the full year, the net EPS outlook was cut to a range of $4.36 to $4.76 from $4.76 to $4.96, while the adjusted EPS outlook of $4.80 to $5.20 surrounds the FactSet consensus of $5.13. “While we recognize there are opportunities in the business, and are addressing the challenges we are facing in a difficult retail environment, we are pleased that our team delivered second quarter profitability above our expectations,” said Chief Executive Brian Cornell. The stock has gained 4% year to date through Tuesday, while the SPDR S&P Retail ETF has climbed 6% and the S&P 500 has advanced 6.6%.

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Deutsche Bank AG’s retail bank head Christian Sewing is urging the lender’s top management to waive their 2016 bonuses if financial results remain lackluster. In an interview with German newspaper Bild, the top executive said if “we don’t pay our shareholders a dividend, then our own bonus must be put up for debate.” Deutsche Bank scrapped bonuses for its top management last year after posting a record annual loss. This year is not looking any brighter for the German lender, which posted a 98% slump in profit in the second quarter due to weak performances in trading and investment banking. Deutsche Bank shares in July slumped to an all-time low, prompting an exclusion from the Stoxx 50 index. Shares dropped 1.3% on Wednesday.

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Cisco Systems Inc. plans to lay off more than 14,000 workers in the next few weeks, CRN reported late Tuesday, citing multiple sources close to the company. The staff cuts, which affect almost 20% of the networking company’s workforce, arise from Cisco’s shift in focus from hardware to software, CRN said. The San Jose, Calif.-based company has a tradition of making layoffs in the summer, though it skipped last year, so analysts have suggested the loss of headcount this year may be heftier than in previous rounds. Cisco is scheduled to release its fiscal 2016 earnings on Wednesday. The company could not be reached for comment.

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