Category: Stock Market News

U.S. stocks opened lower on Wednesday, as disappointing earnings reports by companies like Walt Disney Co. , Macy’s Inc. and Staples Inc. weighed on the broader market. A retreat in crude oil prices added to the selling pressures in the equity market, a day after the S&P and the Dow logged their largest daily gain in about two months. The S&P 500 was down 5 points, or 0.2%, to 2,079. The Dow Jones Industrial Average lost 69 points, or 0.4%, to 17,858 at the open. Meanwhile, the Nasdaq Composite began the session down 13 points, or 0.3%, at 4,797.

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Macy’s Inc. shares fell 7.5% in Wednesday premarket trading after the retailer reported first-quarter sales that missed expectations and issued a profit warning. Macy’s reported net income of $115 million, or 37 cents per share, down from $193 million, or 56 cents per share, for the same period last year. Adjusted earnings were 40 cents per share, beating the FactSet consensus of 36 cents per share. Revenue for the quarter totaled $5.8 billion, down from $6.2 billion and below the $5.9 billion FactSet consensus. Same-store sales on an owned and licensed basis were down 5.6% for the quarter. The retailer expects full-year 2016 same-store sales to fall between 3% and 4%, and earnings per share in the range of $3.15 to $3.40, lowered from previous guidance of $3.80 to $3.90. Macy’s raised its dividend to 37.75 cents per share from 36 cents per share. Company shares are down 44% for the past year while the S&P 500 is down 1% for the same period.

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Wendy’s Co. shares jumped 5.1% in Wednesday premarket trading after the fast-food company’s first-quarter earnings beat expectations and it raised its 2016 outlook. Wendy’s reported net income of $25.4 million, or 9 cents per share, compared with $27.5 million, or 7 cents per share, for the same period last year. Adjusted earnings were 11 cents per share, exceeding the FactSet consensus of 6 cents per share. Revenue for the quarter fell to $378.8 million from $451.8 million, beating the FactSet consensus of $351 million. The decline was primarily the result of the company’s owning 375 fewer restaurants. Same-store sales increased 3.6% in North America system. Wendy’s raised its full-year 2016 earnings outlook to between 38 cents and 40 cents from between 35 cents and 37 cents. The company expects same-store sales to climb 3% in North America. Wendy’s also provided an update on the investigation into unusual credit card activity at its restaurants, with preliminary findings showing that malware installed through a compromised third-party affected a point of sale system at fewer than 300 franchised restaurants starting in fall 2015. The company is currently rolling out another system called Aloha that was not impacted. About 50 franchise restaurants were found to have or suspected to have experienced unrelated cybersecurity issues. Wendy’s shares are up 3.8% for the year so far while the S&P 500 is up 2% for the same period.

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Walt Disney Co.’s stock tumbled more than 5% in premarket trade Wednesday, enough to push the Dow Jones Industrial Average firmly into negative territory, on the heels of disappointing quarterly results. The shares shed $5.50, or 5.1%, ahead of the open, which would shave about 38 points off the Dow’s price. Dow futures were down 45 points. The stock is on track to open at the lowest price seen during regular session hours since April 18.

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From:: Stock Market News

Walt Disney Co.’s stock tumbled more than 5% in premarket trade Wednesday, enough to push the Dow Jones Industrial Average firmly into negative territory, on the heels of disappointing quarterly results. The shares shed $5.50, or 5.1%, ahead of the open, which would shave about 38 points off the Dow’s price. Dow futures were down 45 points. The stock is on track to open at the lowest price seen during regular session hours since April 18.

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Turning Point Brands Inc. said Wednesday it priced its initial public offering at $10 a share. The provider of alternative tobacco products such as snuff and smokeless products sold 5.4 million shares to raise $54 million. The stock will start trading today under the symbol “TPB”. Cowen & Co. LLC and FBR Capital Markets & Co. were joint leads on the deal.

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Staples Inc. announced plans for change after the office-supply company’s $6.3 billion merger deal with Office Depot Inc. was called off Tuesday. The company, which will pay a $250 million breakup fee in the wake of the failed merger fight, said in a news release that it is initiating a $300 million cost-reduction plan, cancelling a deal to sell $550 million in corporate contracts to Essendant Inc. , and exploring strategic alternatives for its European operations. Staples also said it will now “pursue acquisitions of business-to-business service providers and companies specializing in categories beyond office supplies to build scale and credibility and accelerate growth in these areas.” Staples said that it expects to close 50 stores in North America and repurchase roughly $100 million in stock this year. Staples stock fell more than 10% in late trading Tuesday before being halted.

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Office-supply retail giants Staples Inc. and Office Depot Inc. announced Tuesday that they are calling off a proposed $6.3 billion combination after an antitrust fight with the federal government, an ending similar to the two companies’ attempt to merge nearly 20 years ago. Office Depot announced that the two companies would terminate their merger agreement on May 16, after a judge Tuesday ruled for the Federal Trade Commission in granting a preliminary injunction halting the deal on antitrust grounds. “While we are respectful of the Court’s decision to grant the FTC’s request for a preliminary injunction to prevent our merger with Staples, we are disappointed by this outcome and strongly believe that a merger would have benefitted all of our customers in the long term,” Office Depot Chief Executive Roland Smith said in Tuesday’s announcement, adding the companies would not appeal. Staples and Office Depot also called off a merger attempt in 1997 after the FTC fought it in court. The two stocks were halted in after-hours trading after plunging in response to the judge’s decision, with Staples falling more than 10% and Office Depot losing more than 26% before the halt.

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Staples Inc. and Office Depot Inc. both plunged in late trading Tuesday after a judge reportedly blocked the two office-supplies retailers from merging. The U.S. Federal Trade Commission had requested a preliminary injunction blocking the merger on antitrust grounds, and a judge Tuesday approved that request, according to The Wall Street Journal. The two retail chains agreed to merge in a $6.3 billion deal announced in February. The stocks were halted after plunging in after-hours trading, with Staples declining more than 10% and Office Depot dropping more than 26% before the halt.

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Alaska Air Group Inc. shares ticked higher in the extended session Tuesday after S&P Dow Jones Indices said the airline would join the S&P 500 Index . Alaska Air shares advanced 1.1% to $70.10 after hours. The airline will replace SanDisk Corp. , which is being acquired by Western Digital Corp. , at the close of trading Thursday.

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