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Shares of paint maker The Sherwin-Williams Co. slid 5.5% Thursday, after the company posted weaker-than-expected profit for the second quarter and offered soft guidance for the full year as it books charges for its acquisition of Valspar. The company said it had net income of $319.1 million, or $3.36 a share, in the second quarter, down from $378.1 million, or $3.99 a share, in the year-earlier period. Adjusted per-share earnings came to $3.80, well below the FactSet consensus of $4.56. The adjusted number includes charges related to the acquisition of Valspar, which closed on June 1. Sales rose 16% to $3.74 billion, just ahead of the FactSet consensus of $3.72 billion. The company said the Valspar deal has led it to change its reporting structure into three new operating segments; the Americas group will house Sherwin-Williams’ previous paint stores group and Latin American coatings group; the consumer brands group will house consumer paint businesses of both companies; and the performance coatings group will house Sherwin-Williams’ and Valspar’s coatings group and automotive refinishes products business. The company said it expects Sherwin-Williams’ core net sales to fall by a low to mid single digit percentage in the third quarter. It expects incremental sales from Valspar to be about $1 billion. EPS is expected to range from $3.70 to $4.10 in the quarter, including a $1.10 per share charge related to the acquisition. The current FactSet consensus is for third-quarter EPS of $4.96. For the full year, Sherwin-Williams’s sales are expected to fall by a mid single digit percentage compared to 2016, while Valspar sales are expected to total about $2.4 billion. “With annual sales at that level, we are updating our guidance for full year 2017 diluted net income per common share to be in the range of $12.30 to $12.70 per share compared to $11.99 per share earned in 2016,” said the company. That includes a $2.50 per share charge for acquisition costs. The current FactSet consensus is for full-year EPS of $14.17. Shares have gained 34% in 2017 through Wednesday, while the S&P 500 has gained 10.5%.

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Abercrombie & Fitch Co. said Thursday that it is launching the namesake brand and abercrombie kids on Alibaba Group Holding’s Tmall. Shares are up 2.2% in premarket trading. Hollister, another Abercrombie brand, has been on Tmall since 2014. Abercrombie & Fitch has 10 bricks-and-mortar stores in mainland China, as well as a local e-commerce site. Abercrombie shares are down more than 52% for the last year. Alibaba shares are up 0.5% in premarket trading, and more than 81% for the past 12 months. The S&P 500 index is up 13.8% for the last year.

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Sears Holdings Corp. said Thursday that it has launched Kenmore appliances on Amazon.com Inc. , including Alexa-enabled smart appliances. The Kenmore Smart air conditioner is now available. Sears shares are up 8.3% in premarket trading. This is the broadest distribution of Kenmore products outside of Sears stores and related online sites, according to Sears. Distribution will be nationwide, and Kenmore, Sears Home Services and Innovel Solutions will provide delivery, installation, and other services. Terms of the deal weren’t disclosed. Sears stock is down 41.7% for the past year. Amazon shares are up 0.3% in premarket trading and up 37.7% for the last 12 months. The S&P 500 index is up nearly 14% for the last year.

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Kala Pharmaceuticals Inc. said Thursday it has priced its initial public offering at $15 a share. The company sold 6 million shares to raise $90 million in a deal underwritten by J.P. Morgan, BofA Merrill Lynch and Wells Fargo Securities, with Wedbush PacGrow acting as co-manager. The company is developing treatments for inflammation and pain after eye surgery and for temporary relief of signs and symptoms of dry eye disease, with both currently in late-stage trials. The stock will start trading Thursday on the Nasdaq under the ticker symbol “KALA.”

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The European Central Bank, as expected, left interest rates unchanged Thursday while reiterating its plan to buy 60 billion euros of government bonds and other assets each month through December, “or beyond, if necessary.” Investors are expected to focus on ECB President Mario Draghi’s news conference for clues to when the bank might begin to taper and wind down its asset purchase program. Draghi’s news conference is scheduled to begin at 2:30 p.m. Frankfurt time, or 8:30 a.m. Eastern.

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Polaris Industries Inc. reported Thursday a second-quarter net profit that fell to $62.0 million, or 97 cents a share, from $71.2 million, or $1.09 a share, in the same period a year ago. The off-road vehicle maker said adjusted earnings per share came to $1.16, above the FactSet consensus of $1.08. Revenue rose to $1.36 billion from $1.13 billion, beating the FactSet consensus of $1.26 billion. Off-road and snowmobile sales rose to $845.5 million from $799.3 million, above the FactSet consensus of $761.7 million, while motorcycle sales fell 13% to $198 million but beat expectations of $192 million. The company raised its 2017 sales growth outlook to 12% to 14% from 10% to 13% and its adjusted EPS outlook to $4.35 to $4.50 from $4.25 to $4.50. “The powersports industry remained very competitive and headwinds persist, but we were encouraged by the return to growth in our Side-by-Side business and continued strength and aggressive share gains for Indian Motorcycles,” said Chief Executive Scott Wine. On Wednesday, the company said it recalled 25,600 ATVs after reports of fuel leaks and fires. The stock, which wasn’t active in premarket trade, has rallied 12.2% year to date, while the S&P 500 has gained 10.5%.

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Citigroup initiated coverage of electric car maker Tesla Inc. Thursday, with a neutral/high risk rating and $357 stock price target. That’s equal to about 10% upside from its current level. “We’re positive on Tesla’s position as a Car of the Future leader and view the upside case to still be significant, however, we prefer to wait for a better entry point either through: (a) A stronger balance sheet, which in our view would more favorably tilt the 12-month risk/reward equation, all-else-equal; or (b) convincing signs of a smooth Model 3 ramp with limited Model S cannibalization,” analyst Itay Michaeli wrote in a note. The analyst said he is “fundamentally bullish” on Tesla, but that both bull and bear cases for the stock have merit. On the bull side, the company has had initial product success, brand appeal, speed of innovation and tech/software leadership,” he wrote. The next 12 months rely on Tesla achieving Model 3 conversions and meeting margin goals, while continuing to cement its leadership in self-driving. Tesla shares were slightly lower premarket, but have gained 52% in 2017, while the S&P 500 has gained 10.5%.

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Philip Morris International Inc. on Thursday reported revenues of $19.32 billion vs. $19.04 billion a year ago, below the FactSet consensus of $20.07 billion. It had adjusted earnings per share of $1.14, down from $1.15 a year ago and missing the FactSet consensus of $1.23. CEO André Calantzopoulos called the quarterly results “robust” but the company cut its 2017 EPS outlook to $4.78-$4.93 from $4.84-$4.99. Cigarette shipment volumes were down 7.5% in the second quarter. The stock has gained 33% for the year to date, compared to 10.50% for the S&P 500

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Insurer The Travelers Cos. Inc. said Thursday it had net income of $595 million, or $2.11 a share, in the second quarter, down from $664 million, or $2.24 a share, in the year-earlier period. Adjusted per-share earnings came to $1.92. The FactSet consensus was for EPS of $2.11. Revenue rose to $7.184 billion from $6.785 billion, while net written premiums rose to $6.640 billion from $6.345 billion. The FactSet consensus was for $6.547 billion. The company said it had an underwriting gain of $173 million, down from $388 million a year ago. “Second quarter core income of $543 million and core return on equity of 9.5% were impacted by high levels of catastrophe and non-catastrophe weather-related losses caused by significant U.S. tornado and hail activity,” Chief Executive Alan Schnitzer said in a statement. The company’s net investment income rose to $598 million from $549 million. Shares were not yet active premarket, but have gained 3.3% in 2017, while the Dow Jones Industrial Average has gained 9.5% and the S&P 500 has gained 10.5%.

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