Category: Stock Market News

L Brands Inc. shares sank 11.5% in late Wednesday trading after the Victoria’s Secret parent gave weak guidance. Net income was $631.7 million, or $2.18 per share, compared with $636.0 million, or $2.15 per share, last year. Adjusted EPS was $2.03, beating the $1.90 FactSet consensus. Sales were $4.49 billion, up from $4.40 billion and meeting the FactSet consensus. Same-store sales for the quarter were flat, also meeting the FactSet consensus. However, same-store sales at Victoria’s Secret declined 3%, while at Bath & Body Works, same-store sales increased 5%. L Brands expects 2017 EPS between $3.05 and $3.35, falling short of the $3.61 FactSet consensus. The company expects to report a mid-to-high-teens same-store sales decline in the month of February, reflecting declines at both Victoria’s Secret and Bath & Body Works. L Brands’ exit from the swim and apparel categories will also hurt same-store sales for the month by 6 percentage points, the company said. L Brands shares are down 30.8% for the last year while the S&P 500 index is up 21.5% for the same period.

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Treasury Secretary Steven Mnuchin said the strong U.S. dollar is a “good thing” in the long run in an interview with The Wall Street Journal. Mnuchin said that the strength of the dollar has to do with where the U.S. economy is relative to the rest of the world’s. “For longer-term purposes, an appreciation of the dollar is a good thing, and I would expect longer-term, as you’ve seen over periods of time, the dollar does appreciate.”

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Shares of Square Inc. rose more than 5% after hours on Wednesday, after the payments company narrowed its losses and reported results that were better than Wall Street expected. Square reported a net loss of $15.2 million for the fourth quarter, or 4 cents per share, compared with a loss of $80.5 million, or 34 cents during the same quarter a year ago. Analysts tracked by FactSet expected Square to report a per-share loss of 9 cents. Revenue hit $451.9 million in the quarter, up from $374.4 million in the year-earlier period and above the FactSet consensus of $449.8 million. Square’s gross payment volume increased 34% in the fourth quarter to $13.7 billion. The company expects 2017 total revenue to be in the range of $2.09 billion to $2.15 billion. FactSet expects revenue for the year to hit $2.1 billion. Square shares have gained nearly 45% in the trailing 12-month period, while the S&P 500 Index is up more than 21% in the same time frame

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The Dow Jones Industrial Average’s rally Wednesday to a 9th-straight record close helped push its 50-day moving average as far above its 200-day moving average as it has been in nearly 18 years. The 50-day MA, seen by many as a short-term trend tracker, rose to 20,017.83. The 200-day MA, which many use as a dividing line between longer-term uptrends and downtrends, rose to 18,703.43. That put the 50-day MA 1,314.40 points above the 200-day MA, the most since June 17, 1999. On a percentage basis, the the 50-day MA closed 6.79% above its 200-day MA, the biggest spread since Aug. 6, 2013.

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Shares of Fitbit rose 4% after hours Wednesday after it reported a fourth-quarter net loss of $146.3 million, or a loss of 65 cents per share, after net income of $64.2 million, or 26 cents per share, in the year-earlier period. It reported an adjusted loss per share of 56 cents, wider than the FactSet consensus of a loss of 54 cents. It reported revenue of $574 million, down from $711.6 million in the year-earlier period and below the FactSet consensus of $576 million. Fitbit said it expects full-year revenue between $1.5 billion to $1.7 billion, compared to the FactSet consensus of $1.6 billion. For the first quarter, it expects revenue in the range of $270 million to $290 million, compared to the FactSet consensus of $308 million, and an adjusted loss per share between 18 cents and 20 cents, wider than the FactSet consensus of a loss of 16 cents. Shares of Fitbit have fallen 31% in the past three months, compared to the S&P 500’s gain of 7%.

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Tesla Inc. shares rose 1% late Wednesday after the electric-car maker reported a wider-than-expected quarterly loss but beat sales expectations. Tesla said it lost $121.3 million, or 78 cents a share, in the fourth quarter, compared with a loss of $320.4 million, or $2.44 cents a share, in the fourth quarter of 2015. Adjusted for one-time items, Tesla lost $106.5 million, or 69 cents a share, in the quarter, compared with $2.02 a share a year ago. Sales rose to $2.28 billion, compared with $1.21 billion a year ago. Analysts polled by FactSet had expected the Silicon Valley car maker and energy company to report an adjusted loss of 53 cents a share on sales of $2.16 billion. Shares had ended the regular session down 1.4%.

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Viacom Inc. said Wednesday that Brad Grey will step down as chairman and chief executive officer of the media company’s Paramount Pictures subsidiary after 12 years at the company. Grey will remain with the company “for a period” while the search for a successor is conducted. “Brad has overseen the production and distribution of some of Paramount’s most celebrated hits, and more recently championed the successful relaunch of the studio’s television division,” said Viacom Chief Executive Bob Bakish. “As we look ahead, I couldn’t be more excited by our early plans to reenergize the slate, more deeply integrate the studio and networks, and make the most of our incredible assets.” Viacom’s stock, which slipped 0.6% in afternoon trade, has rallied 20.6% over the past 12 months, while the S&P 500 has gained 21.4%.

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Standard & Poor’s downgraded Macy’s Inc.’s ratings to the last level of investment grade Wednesday, after the department store chain’s weak fourth-quarter earnings. S&P lowered the rating to BBB-minus from BBB, and removed its from CreditWatch negative, where it had placed the issuer’s rating on Jan. 5. The downgrade “reflects our view of the company’s weakened operating performance and competitive standing given the ongoing industry challenges, such as sustained low customer traffic, increased price transparency, and unrelenting competition from online, fast-fashion, and off-price retailers,” S&P said in a statement. The outlook is negative, meaning the agency could lower the rating again in the medium term. “We believe the apparel retail market will remain difficult and operating performance will continue to be pressured for Macy’s, which could further weaken the company’s competitive standing and/or its credit metrics, with a likely need for further debt reduction in 2018,” said the agency. Macy’s most active bonds, the 1.875% notes due to mature in January of 2022, were last trading at 99 cents on the dollar, according to MarketAxess.

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Shares of Philip Morris International Inc. got just a brief boost in afternoon trade Wednesday, after the tobacco company provided a new 2017 “currency only” profit outlook. The company said it now expects 2017 earnings per share of $4.80 to $4.95 at prevailing exchange rates, compared with the guidance of $4.70 to $4.85 it provided in its fourth-quarter report released on three weeks ago. Although the company said it raised its EPS guidance “for currency only,” the new outlook excludes an unfavorable currency impact of 8 cents a share, compared with an unfavorable currency impact of 18 cents a share for the previous outlook. The stock was down about 0.3%, then jumped to a gain of as much as 0.3% after the new profit outlook was released, before pulling back to a decline of 0.1% in recent trade. Philip Morris’s stock has gained 13% over the past 12 months, while the S&P 500 has climbed 21%.

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Crude-oil prices on Wednesday logged their first loss in four sessions, giving the previous day’s gain and then some as concerns about growing output from producers outside of a pact to curtail global oversupply plagued investors. West Texas Intermediate crude oil for April delivery finished off 74 cents, or 1.4%, at $53.59 a barrel. Comments from Qatar’s oil minister, Mohammed al-Sada, kicked off the downbeat sentiment. Speaking at an energy meeting in London, al-Sada said major oil producers outside of OPEC weren’t cutting production, as much as they had pledged. The crude market has been anxious about rising production, namely from U.S. shale-oil producers and Russia, who has a history of non-compliance to production limits. Looking ahead, investors are awaiting inventory data from the American Petroleum Institute late Wednesday.

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