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Morning Summary

Jayme Casey, Pat O'Donohue (203) 861-7650 | 5.25.2017

News

Asian markets rallied following gains in the US and ahead of the OPEC meeting. China (+1.4%), Taiwan (+1.1%), Hong Kong (+0.8%), Korea (+0.6%), Japan (+0.4%) and Australia (+0.4%) led to the upside. Regional volumes were +10% from yesterday, but remained quiet.

European markets are mixed in extremely quiet trading with several markets offline for holidays, among them Austria, Denmark, Finland, Norway, Sweden and Switzerland. Volumes elsewhere are running at ~65% of the 20 day average, -20% from yesterday. UK Q1 GDP +0.2% QoQ vs. estimates +0.3%, and UK April Housing Loans 40,750 vs. 40,800. EUR -5 bps, GBP-15 bps.

US equities point to a +30bps opening ahead of Advance Goods Trade Balance, Weekly Claims and Retail and Wholesale Inventories at 8:30am, Bloomberg Consumer Comfort at 9:45am, and Kansas City Fed at 11am. Oil futures sold off more than 2.5% after hitting $52/bbl on commentary from the OPEC meeting. While members are in agreement for a 9-month production cut extension, attendees said there is no need for deeper cuts and the UAE said it would prefer a 6-month cut. The meeting will reconvene at 9am EST, finishing with a press conference at 11am EST. In M&A news, Expo Holdings raised its bid for Global Sources (GSOL) from $18 to $20/sh cash. Brown-Forman (BF/B) said it is no for sale after reports surfaced earlier in the week that Constellation Brands (STZ) was in talks to acquire the company. The Nikkei reported that Toshiba (6502 JP) now said it agreed to discuss the sale of its chip unit with Western Digital (WDC). Alliance Data (ADS) will purchase some of Signet’s (SIG) credit card portfolio valued at ~$1bn. Vulcan (VMC) will acquire closely-held Aggregates USA LLC from SPO Partners & Co. for $900mm in cash. In other news, Alibaba (BABA) and Ant Financial will make a $1bn investment in Ele.me, a leading Chinese food-delivery service. Dominion (D) said it will shut-in all gathering and transmission systems in its Hastings plant for repair. Apple (AAPL) determined that Taiwan Semi’s (TSM) processors have not reached the desired quality demanded after 3 attempts, possibly delaying the new iPhone. GE (GE) announced plans to invest as much as $2.2bn in Nigerian rail. Comstock Mining (LODE) said it has “significantly” advanced 2 strategic venture discussions and expects at least one to occur in Q2. Aerie Pharma (AERI) and Radius Health (RDUS) reported positive study data. Shares of IHS Markit (INFO) climber nearly 5% post-market after word that it will be added to the S&P 500. Additionally, TEGNA (TGNA) and its spin-off, Cars.com (CARS-W), will join the S&P MidCap 400, JC Penny (JCP), Time (TIME) and Independence Realty (IRT) will move to the S&P SmallCap 600, and Yahoo! (YHOO) will be removed from S&P Dow Jones Indices. Quanta Services (PWR) approved a $300mm repurchase, Quintiles (Q) announced a 10.6mm shares secondary, Costamare (CMRE) will offer 12.5mm shares, Bank of the Ozarks (OZRK) priced 6.6mm shares at $45.80/sh, BlackLine (BL) priced 3.5mm shares at $33/sh, Corium (CORI) priced 4.8mm shares at $6.25/sh, Mindbody (MB) priced 4.4mm shares at $27.95/sh, Syndax (SNDX) priced 3.8mm shares at $13.25/sh, JELD-WEN (JELD) priced 14mm shares at $30.75/sh, EVINE (EVLV) will conduct a 4mm share direct offering at $1.12/sh, Aerie Pharma (AERI) entered into a $50mm ATM offering, Sun Communities (SUI) priced and upsized, 4.2mm share secondary in the range of $85.10-$86.85, and Lending Tree (TREE) priced its previously-announced convertible note offering.

Sears (SHLD), Patterson Cos (PDCO), Toronto Dominion (TD), Medtronic (MDT), Burlington Stores (BURL), Best Buy (BBY), NGL Energy (NGL), and Nomad Foods (NOMD) beat EPS estimates, Hormel (HRL), Movado (MOV), Signet (SIG) and International Game (IGT) missed, and Advanced Drainage (WMS) reported a surprise loss. Companies reporting after the bell include Brocade (BRCD), Costco (COST), Deckers (DECK), GameStop (GME), Lions Gate (LGF/A) and Splunk (SPLK).

Analyst Actions: AK Steel (AKS) raised to “buy” at Clarksons, Chipotle (CMG) raised to “buy” at Argus

 

Premarket Movers:

·         Aerie Pharma (AERI) +32% study results

·         Pure Storage (PSTG) +13% guidance (yesterday)

·         Global Sources (GSOL) +12.25% Expo raises bid for company

·         Best Buy (BBY) +11.25% earnings

·         William-Sonoma (WSM) +9.5% guidance (yesterday)

·         Sears (SHLD) +8.5% earnings

·         PVH (PVH) +5.5% earnings

·         Costamre (CMRE) -11% secondary

·         Corium (CORI) -9% secondary

 

IPOs Priced Yesterday:

·         WideOpenWest (WOW) 18.2mm shares at $17; downsized, below range

·         Appian Corp (APPN) 6.3mm shares at $12

Morning Summary | TMT | Energy  | Healthcare  | Consumer  | Financial  | Industrial  | Global Trading Summary

TMT

Jared Mancuso, Sean Greeley (203) 861-7650 | 5.25.2017

News

BL  BlackLine 3.5M offering for holders priced at $33/share through Goldman Sachs and JPMorgan

 

APPN  Appian Corp. 6.3M-share IPO priced at $12/share through Morgan Stanley, Goldman Sachs, Barclays

 

WOW  WideOpenWest, Inc. 18.2M share IPO priced at $17.00/sh through UBS, Credit Suisse

 

MB  Mindbody 4.4M class A share offering priced at $27.95/sh through JPMorgan, UBS, Jefferies, Credit Suisse

 

NTAP  NetApp reports Q4 EPS $0.86 ex-items vs FactSet $0.82; increases dividend

  • Reports Q4:
    • Revenue $1.48B vs FactSet $1.44B
  • Q1 Guidance:
    • EPS $0.49-0.57 vs FactSet $0.66
    • Revenue $1.24-1.39B vs FactSet $1.33B
  • FY Guidance (Apr 2019):
    • Non-GAAP gross margin 62-63%
    • Non-GAAP operating margin 18-20%
    • effective tax rate 19-20%
  • Quarterly dividend increase by 5% to $0.20 from $0.19

payable 26-Jul; record 7-Jul

 

CRM  Salesforce.com announces strategic agreement with Dell Technologies

  • Salesforce and Dell Technologies announced a strategic technology agreement. Extending the long-standing relationship between the two companies, Dell Technologies will expand the use of Salesforce's market-leading sales, service, and marketing applications and CRM platform, which have been made smarter by Einstein artificial intelligence, to thousands of Dell Technologies employees worldwide, empowering them to deliver even greater customer success.

Salesforce will provide Dell Technologies a flexible platform to bring together sales, service, marketing and more, enabling a more unified customer experience. Dell Technologies customer contact centers worldwide will now have access to Service Cloud Einstein, integrating with the existing Sales Cloud footprint.

 

PSTG  Pure Storage reports Q1 non-GAAP EPS ($0.14) vs FactSet ($0.22)

  • Reports Q1:
    • Revenue $182.6M vs FactSet $176.1M
  • Q2 Guidance:
    • Revenue $214-222M vs FactSet $214.1M
    • Non-GAAP gross margin 63.5% to 66.5%
    • Non-GAAP operating margin -16% to -12%
  • FY Guidance (Jan 2018):

Reaffirms revenue $975M to $1.025B vs FactSet $989.3M

 

HPQ  HP, Inc. reports Q2 EPS $0.40 ex-items vs FactSet $0.39

  • Reports Q2:
    • Revenue $12.39B vs FactSet $11.89B
  • Q3 Guidance:
    • EPS $0.40-0.43 vs FactSet $0.42
  • FY Guidance (Oct 2017):

EPS $1.59-1.66 vs FactSet $1.62

 

CSRA  CSRA Inc reports Q4 EPS $0.49 ex-items vs FactSet $0.43

  • Reports Q4:
    • Revenue $1.25B vs FactSet $1.25B
    • Adjusted EBITDA $207.0M vs FactSet $186.8M
  • FY Guidance (Mar 2018):
    • EPS $1.88-2.00 vs FactSet $1.90

Revenue $5.00-5.20B vs FactSet $5.12B

 

CSPI  CSP Inc. reports Q2 GAAP EPS $0.11 vs year-ago $0.13 -- 10-Q

  • Reports Q2:

Revenue $25.3M vs year-ago $27.1M

 

WUBA  58.com Inc. reports Q1 non GAAP EPADS $0.10 vs FactSet ($0.29)

  • Reports Q1:
    • Revenue $288.2M vs FactSet $264.3M
  • Q2 Guidance:

Revenue CNY2.25-CNY2.35B

 

GSOL  Expo increases consideration for Global Sources to $20/share from $18/share

  • Global Sources announced that the company and Expo Holdings have entered into an amendment to the previously announced agreement and Plan of Amalgamation providing for an increase in the amalgamation consideration from $18.00 per share in cash to $20.00 per share in cash.
  • On 24-May-17, the company's board received a proposal from a third party to acquire all the outstanding common shares of the company for $20.00 per share in cash.

On 25-May-17, the board received a proposal from Parent to amend the original agreement and Plan of Amalgamation to increase the amalgamation consideration from $18.00 per share to $20.00 per share.

 

RHT  Red Hat to acquire Codenvy

  • The company has signed a definitive agreement to acquire Codenvy, provider of cloud-native development tools that enable developers to more easily create modern container-based and cloud-native applications.
  • By adding Codenvy to its existing portfolio of developer tools and application platforms, including Red Hat JBoss Middleware and Red Hat OpenShift, Red Hat continues its efforts to provide solutions that enable developers to create applications for hybrid cloud environments.
  • Red Hat plans to make Codenvy an integral part of OpenShift.io, Red Hat’s recently announced hosted development environment for building hybrid cloud services on OpenShift.

Terms were not disclosed.

 

SIG  Signet Jewelers issues press release on agreement with Alliance Data (ADS), updates on outsourcing of credit portfolio

Signet Jewelers announced the first phase of the strategic outsourcing of its in-house credit program and outlined steps to achieve a fully-outsourced program structure

Upgrades/ Downgrades

BL  BlackLine 3.5M offering for holders priced at $33/share through Goldman Sachs and JPMorgan

 

APPN  Appian Corp. 6.3M-share IPO priced at $12/share through Morgan Stanley, Goldman Sachs, Barclays

 

WOW  WideOpenWest, Inc. 18.2M share IPO priced at $17.00/sh through UBS, Credit Suisse

 

MB  Mindbody 4.4M class A share offering priced at $27.95/sh through JPMorgan, UBS, Jefferies, Credit Suisse

 

NTAP  NetApp reports Q4 EPS $0.86 ex-items vs FactSet $0.82; increases dividend

  • Reports Q4:
    • Revenue $1.48B vs FactSet $1.44B
  • Q1 Guidance:
    • EPS $0.49-0.57 vs FactSet $0.66
    • Revenue $1.24-1.39B vs FactSet $1.33B
  • FY Guidance (Apr 2019):
    • Non-GAAP gross margin 62-63%
    • Non-GAAP operating margin 18-20%
    • effective tax rate 19-20%
  • Quarterly dividend increase by 5% to $0.20 from $0.19

payable 26-Jul; record 7-Jul

 

CRM  Salesforce.com announces strategic agreement with Dell Technologies

  • Salesforce and Dell Technologies announced a strategic technology agreement. Extending the long-standing relationship between the two companies, Dell Technologies will expand the use of Salesforce's market-leading sales, service, and marketing applications and CRM platform, which have been made smarter by Einstein artificial intelligence, to thousands of Dell Technologies employees worldwide, empowering them to deliver even greater customer success.

Salesforce will provide Dell Technologies a flexible platform to bring together sales, service, marketing and more, enabling a more unified customer experience. Dell Technologies customer contact centers worldwide will now have access to Service Cloud Einstein, integrating with the existing Sales Cloud footprint.

 

PSTG  Pure Storage reports Q1 non-GAAP EPS ($0.14) vs FactSet ($0.22)

  • Reports Q1:
    • Revenue $182.6M vs FactSet $176.1M
  • Q2 Guidance:
    • Revenue $214-222M vs FactSet $214.1M
    • Non-GAAP gross margin 63.5% to 66.5%
    • Non-GAAP operating margin -16% to -12%
  • FY Guidance (Jan 2018):

Reaffirms revenue $975M to $1.025B vs FactSet $989.3M

 

HPQ  HP, Inc. reports Q2 EPS $0.40 ex-items vs FactSet $0.39

  • Reports Q2:
    • Revenue $12.39B vs FactSet $11.89B
  • Q3 Guidance:
    • EPS $0.40-0.43 vs FactSet $0.42
  • FY Guidance (Oct 2017):

EPS $1.59-1.66 vs FactSet $1.62

 

CSRA  CSRA Inc reports Q4 EPS $0.49 ex-items vs FactSet $0.43

  • Reports Q4:
    • Revenue $1.25B vs FactSet $1.25B
    • Adjusted EBITDA $207.0M vs FactSet $186.8M
  • FY Guidance (Mar 2018):
    • EPS $1.88-2.00 vs FactSet $1.90

Revenue $5.00-5.20B vs FactSet $5.12B

 

CSPI  CSP Inc. reports Q2 GAAP EPS $0.11 vs year-ago $0.13 -- 10-Q

  • Reports Q2:

Revenue $25.3M vs year-ago $27.1M

 

WUBA  58.com Inc. reports Q1 non GAAP EPADS $0.10 vs FactSet ($0.29)

  • Reports Q1:
    • Revenue $288.2M vs FactSet $264.3M
  • Q2 Guidance:

Revenue CNY2.25-CNY2.35B

 

GSOL  Expo increases consideration for Global Sources to $20/share from $18/share

  • Global Sources announced that the company and Expo Holdings have entered into an amendment to the previously announced agreement and Plan of Amalgamation providing for an increase in the amalgamation consideration from $18.00 per share in cash to $20.00 per share in cash.
  • On 24-May-17, the company's board received a proposal from a third party to acquire all the outstanding common shares of the company for $20.00 per share in cash.

On 25-May-17, the board received a proposal from Parent to amend the original agreement and Plan of Amalgamation to increase the amalgamation consideration from $18.00 per share to $20.00 per share.

 

RHT  Red Hat to acquire Codenvy

  • The company has signed a definitive agreement to acquire Codenvy, provider of cloud-native development tools that enable developers to more easily create modern container-based and cloud-native applications.
  • By adding Codenvy to its existing portfolio of developer tools and application platforms, including Red Hat JBoss Middleware and Red Hat OpenShift, Red Hat continues its efforts to provide solutions that enable developers to create applications for hybrid cloud environments.
  • Red Hat plans to make Codenvy an integral part of OpenShift.io, Red Hat’s recently announced hosted development environment for building hybrid cloud services on OpenShift.

Terms were not disclosed.

 

SIG  Signet Jewelers issues press release on agreement with Alliance Data (ADS), updates on outsourcing of credit portfolio

Signet Jewelers announced the first phase of the strategic outsourcing of its in-house credit program and outlined steps to achieve a fully-outsourced program structure

Morning Summary | TMT | Energy  | Healthcare  | Consumer  | Financial  | Industrial  | Global Trading Summary

Energy News

 (203) 861-7650 | 5.25.2017

News

TSO Tesoro announces waiting period for proposed acquisition of Western Refining (WNR) to Hart Scott Rodino Act has terminated, expects to close 1-Jun-17 ($83.09)

PBR Court dismisses without prejudice suit to suspend Pretrobras transfer of rights in shallow-water concessions in Ceará and Sergipe ($9.08) 

  • Petrobras reports that it was formally notified today of the decision by the 3rd Federal District Court of Sergipe to dismiss without prejudice the popular interest suit to suspend the process of transfer of oil and natural gas exploration, development, and production rights for a set of shallow water fields, located in the states of Ceará and Sergipe.
  • The dismissal results from a petition filed by Petrobras based on the decision issued by the Federal Court of Accounts (TCU), which authorizes the advance of the company’s divestment program, ordering the application of a revised methodology to divestment projects.

 

SPKE Spark Energy board authorizes share buyback program of up to $50M of Class A common stock ($40.00)


EPE EP Energy and Tesoro (TSO) announce Uinta Basin joint venture ($4.81) 

  • EP Energy and Tesoro announced the formation of a drilling joint venture, through respective subsidiaries, to fund oil and natural gas development in EP Energy's Altamont program located in the Uinta Basin of Utah. Highlights:
    • 60 well program
    • Tesoro to provide a capital carry in exchange for 50% of EP Energy's working interest in joint venture wells
    • Tesoro to purchase all oil production from joint venture wells
    • EPE's net share of capital is expected to be ~$64M
    • EPE will retain operational control of the joint venture assets
  • Additionally, EP Energy and Tesoro signed a multi-year Crude Oil Supply agreement for yellow and black waxy crude oil to supply Tesoro's Salt Lake City Refinery.
  • The first wells under the joint venture are expected to begin production in July
  • EP Energy did not change its 2017 guidance for the new drilling venture; however the company expects to update its full year 2017 outlook mid-year.

 

HQCL Hanwha Q CELLS reports Q1 EPADS $0.21 vs FactSet ($0.13) -- 1 estimate ($7.01) 

  • Reports Q1:
    • Revenue $432.0M vs FactSet $418.0M -- 1 estimate
    • Gross margin was 13.8%, compared with 7.0% in Q4 of 2016 and 21.2% in Q1 of 2016.
  • Q2 Guidance:
    • Revenue $560-580M vs FactSet $650.6M
  • For the full year 2017, the company reiterates its previous guidance of:
    • Total module shipments in the range of 5,500 to 5,700 MW
    • Revenue-recognized module shipments in the range of 5,300 to 5,500 MW
    • Capital expenditures of approximately $50M for manufacturing technology upgrades and certain R&D related expenditures

 

NGL NGL Energy Partners reports Q4 adjusted EBITDA $121.0M vs FactSet $120.5M ($14.70) 

  • Reports Q4:
    • EBITDA $121.0M vs FactSet $120.5M
    • Distributable Cash Flow for Q4 of Fiscal 2017 was $84.0M and totaled $234.8M for the year
  • FY Guidance (Mar 2018):
    • Adjusted EBITDA $500M-$525M vs FactSet $507.0M
    • Distributable Cash Flow is expected to be between $300M and $325M and would generate over $100M, or about 1.3x, distributioncoverage at our current annualized distribution rate, including distributions on the Class A Preferred Units.
    • The Partnership currently expects to spend approximately $150M to $200M on growth capital expenditures during fiscal 2018.

Upgrades/ Downgrades

TSO Tesoro announces waiting period for proposed acquisition of Western Refining (WNR) to Hart Scott Rodino Act has terminated, expects to close 1-Jun-17 ($83.09)

PBR Court dismisses without prejudice suit to suspend Pretrobras transfer of rights in shallow-water concessions in Ceará and Sergipe ($9.08) 

  • Petrobras reports that it was formally notified today of the decision by the 3rd Federal District Court of Sergipe to dismiss without prejudice the popular interest suit to suspend the process of transfer of oil and natural gas exploration, development, and production rights for a set of shallow water fields, located in the states of Ceará and Sergipe.
  • The dismissal results from a petition filed by Petrobras based on the decision issued by the Federal Court of Accounts (TCU), which authorizes the advance of the company’s divestment program, ordering the application of a revised methodology to divestment projects.

 

SPKE Spark Energy board authorizes share buyback program of up to $50M of Class A common stock ($40.00)


EPE EP Energy and Tesoro (TSO) announce Uinta Basin joint venture ($4.81) 

  • EP Energy and Tesoro announced the formation of a drilling joint venture, through respective subsidiaries, to fund oil and natural gas development in EP Energy's Altamont program located in the Uinta Basin of Utah. Highlights:
    • 60 well program
    • Tesoro to provide a capital carry in exchange for 50% of EP Energy's working interest in joint venture wells
    • Tesoro to purchase all oil production from joint venture wells
    • EPE's net share of capital is expected to be ~$64M
    • EPE will retain operational control of the joint venture assets
  • Additionally, EP Energy and Tesoro signed a multi-year Crude Oil Supply agreement for yellow and black waxy crude oil to supply Tesoro's Salt Lake City Refinery.
  • The first wells under the joint venture are expected to begin production in July
  • EP Energy did not change its 2017 guidance for the new drilling venture; however the company expects to update its full year 2017 outlook mid-year.

 

HQCL Hanwha Q CELLS reports Q1 EPADS $0.21 vs FactSet ($0.13) -- 1 estimate ($7.01) 

  • Reports Q1:
    • Revenue $432.0M vs FactSet $418.0M -- 1 estimate
    • Gross margin was 13.8%, compared with 7.0% in Q4 of 2016 and 21.2% in Q1 of 2016.
  • Q2 Guidance:
    • Revenue $560-580M vs FactSet $650.6M
  • For the full year 2017, the company reiterates its previous guidance of:
    • Total module shipments in the range of 5,500 to 5,700 MW
    • Revenue-recognized module shipments in the range of 5,300 to 5,500 MW
    • Capital expenditures of approximately $50M for manufacturing technology upgrades and certain R&D related expenditures

 

NGL NGL Energy Partners reports Q4 adjusted EBITDA $121.0M vs FactSet $120.5M ($14.70) 

  • Reports Q4:
    • EBITDA $121.0M vs FactSet $120.5M
    • Distributable Cash Flow for Q4 of Fiscal 2017 was $84.0M and totaled $234.8M for the year
  • FY Guidance (Mar 2018):
    • Adjusted EBITDA $500M-$525M vs FactSet $507.0M
    • Distributable Cash Flow is expected to be between $300M and $325M and would generate over $100M, or about 1.3x, distributioncoverage at our current annualized distribution rate, including distributions on the Class A Preferred Units.
    • The Partnership currently expects to spend approximately $150M to $200M on growth capital expenditures during fiscal 2018.
Morning Summary | TMT | Energy  | Healthcare  | Consumer  | Financial  | Industrial  | Global Trading Summary

Healthcare News

Patrick O'Donohue, CFA, Jared Mancuso (203) 861-7650 | 5.25.2017

News

AERI Aerie Pharmaceuticals reports positive Roclatan 0.02%/0.005% Phase 3 topline efficacy results; conference call today ($40.50) 

  • Roclatan Phase 3 Highlights for Mercury 2:
    • Roclatan dosed once daily achieved the primary efficacy endpoint of demonstrating statistical superiority over both latanoprost and Rhopressa at the primary endpoint range of baseline IOPs from above 20 to below 36 mmHg for each of the nine measured time points.
    • IOPs were measured at 8 a.m., 10 a.m., and 4 p.m. at week 2, week 6, and day 90. Roclatan IOP lowering exceeded that of latanoprost in a range of 1.5 to 2.4 mmHg for an average of 1.8 mmHg, and exceeded Rhopressa IOP lowering in a range of 2.2 to 3.3 mmHg for an average of 2.7 mmHg. Efficacy levels were consistent across the 90-day period for all arms in the study. 

AERI Aerie Pharmaceuticals enters $50M ATM equity sales agreement with Cantor Fitzgerald - 8-K ($40.50)

  • The common stock will be issued pursuant to the company’s registration statement on Form S-3, which became effective upon its filing on 15-Sep-16. 

CFRX ContraFect initiates phase 2 study of CF-301 in patients with staphylococcus aureus bacteremia ($1.30) 

  • ContraFect announced the initiation of an international Phase 2 study evaluating CF-301 as a potential treatment of Staphylococcus aureus (Staph aureus) bacteremia including right sided endocarditis. 

PDCO Patterson Companies reports Q4 EPS $0.69 ex-items vs FactSet $0.65 ($43.07) 

  • Reports Q4:
    • Revenue $1.45B vs FactSet $1.46B

MDT Medtronic reports Q4 EPS $1.33 ex-items vs FactSet $1.31 ($84.70) 

  • Reports Q4:
    • Revenue $7.92B vs FactSet $7.86B

CORI Corium International secondary priced at $6.25/share through Jefferies, we're told ($6.87) 

  • StreetAccount notes that post-close, the company announced an offering of indeterminate amount.

MESO Mesoblast reports Q3 EPS ($0.02) vs FactSet ($0.04) ($8.63)

  • Reports Q3:
    • Revenue $0.9M vs FactSet $0.9M

GWPH GW Pharmaceuticals announce publication of results from a Phase 3 study of Epidiolex in children with Dravet syndrome in NEJM ($106.31) 

  • The study randomized 120 children ages two to 18 years (mean age 9.8), with Dravet syndrome whose seizures were not controlled by their current anti-epileptic regimen, to receive either Epidiolex (20Mg/kg/day) or placebo in addition to standard treatment. 

IPCI IntelliPharmaCeutics announces Par Pharmaceutical launches additional strengths of generic Focalin XR ($1.93) 

  • Intellipharmaceutics International Inc. announced that its United States marketing partner, Par Pharmaceutical Inc. , has launched the 10 and 20 mg strengths of its generic Focalin XR (dexmethylphenidate hydrochloride extended-release) capsules in the U.S. 

RDUS Radius Health announces top-line results from completed ACTIVExtend study for TYMLOS in postmenopausal women with osteoporosis ($37.37) 

  • Radius Health announced positive top-line results from the completed 24 month ACTIVExtend trial, which met all of its primary and secondary endpoints. In ACTIVExtend, patients who had completed 18 months of TYMLOS (abaloparatide) injections or placebo in the ACTIVE Phase 3 trial were transitioned to receive 24 additional months of open-label alendronate. 

Upgrades/ Downgrades

AERI Aerie Pharmaceuticals reports positive Roclatan 0.02%/0.005% Phase 3 topline efficacy results; conference call today ($40.50) 

  • Roclatan Phase 3 Highlights for Mercury 2:
    • Roclatan dosed once daily achieved the primary efficacy endpoint of demonstrating statistical superiority over both latanoprost and Rhopressa at the primary endpoint range of baseline IOPs from above 20 to below 36 mmHg for each of the nine measured time points.
    • IOPs were measured at 8 a.m., 10 a.m., and 4 p.m. at week 2, week 6, and day 90. Roclatan IOP lowering exceeded that of latanoprost in a range of 1.5 to 2.4 mmHg for an average of 1.8 mmHg, and exceeded Rhopressa IOP lowering in a range of 2.2 to 3.3 mmHg for an average of 2.7 mmHg. Efficacy levels were consistent across the 90-day period for all arms in the study. 

AERI Aerie Pharmaceuticals enters $50M ATM equity sales agreement with Cantor Fitzgerald - 8-K ($40.50)

  • The common stock will be issued pursuant to the company’s registration statement on Form S-3, which became effective upon its filing on 15-Sep-16. 

CFRX ContraFect initiates phase 2 study of CF-301 in patients with staphylococcus aureus bacteremia ($1.30) 

  • ContraFect announced the initiation of an international Phase 2 study evaluating CF-301 as a potential treatment of Staphylococcus aureus (Staph aureus) bacteremia including right sided endocarditis. 

PDCO Patterson Companies reports Q4 EPS $0.69 ex-items vs FactSet $0.65 ($43.07) 

  • Reports Q4:
    • Revenue $1.45B vs FactSet $1.46B

MDT Medtronic reports Q4 EPS $1.33 ex-items vs FactSet $1.31 ($84.70) 

  • Reports Q4:
    • Revenue $7.92B vs FactSet $7.86B

CORI Corium International secondary priced at $6.25/share through Jefferies, we're told ($6.87) 

  • StreetAccount notes that post-close, the company announced an offering of indeterminate amount.

MESO Mesoblast reports Q3 EPS ($0.02) vs FactSet ($0.04) ($8.63)

  • Reports Q3:
    • Revenue $0.9M vs FactSet $0.9M

GWPH GW Pharmaceuticals announce publication of results from a Phase 3 study of Epidiolex in children with Dravet syndrome in NEJM ($106.31) 

  • The study randomized 120 children ages two to 18 years (mean age 9.8), with Dravet syndrome whose seizures were not controlled by their current anti-epileptic regimen, to receive either Epidiolex (20Mg/kg/day) or placebo in addition to standard treatment. 

IPCI IntelliPharmaCeutics announces Par Pharmaceutical launches additional strengths of generic Focalin XR ($1.93) 

  • Intellipharmaceutics International Inc. announced that its United States marketing partner, Par Pharmaceutical Inc. , has launched the 10 and 20 mg strengths of its generic Focalin XR (dexmethylphenidate hydrochloride extended-release) capsules in the U.S. 

RDUS Radius Health announces top-line results from completed ACTIVExtend study for TYMLOS in postmenopausal women with osteoporosis ($37.37) 

  • Radius Health announced positive top-line results from the completed 24 month ACTIVExtend trial, which met all of its primary and secondary endpoints. In ACTIVExtend, patients who had completed 18 months of TYMLOS (abaloparatide) injections or placebo in the ACTIVE Phase 3 trial were transitioned to receive 24 additional months of open-label alendronate. 
Morning Summary | TMT | Energy  | Healthcare  | Consumer  | Financial  | Industrial  | Global Trading Summary

Consumer News

Josh DiMarzo, Mark Waltos (203) 861-7650 | 5.25.2017

News

MOD Modine Manufacturing reports Q4 EPS $0.35 ex-items vs FactSet $0.34 

  • Reports Q4:
    • Revenue $488.3M vs FactSet $468.4M -- 2 estimates
  • FY Guidance (Mar 2018):
    • EPS $1.20-1.35 vs FactSet $1.13
    • Revenue +25-30% vs prior year's $1.50B, implying $1.88-1.95B vs FactSet $1.86B
    • EBITDA $175-185M vs FactSet $169.3M
  • Management comments:
    • President and CEO, Thomas Burke: "Our base business also returned to growth in Q4, driven in part by significant increases in Asia and market improvements. We are very pleased with the integration of the CIS organization into Modine, and we remain on track to deliver annual cost synergies of at least $15M within the next three to four years.
GES Guess? reports Q1 EPS ($0.24) vs FactSet ($0.32)
  • Reports Q1:
    • Revenue $458.6M vs FactSet $449.2M
  • Q2 Guidance:
    • EPS $0.08-0.11 vs FactSet $0.12
    • Revenue +2-4% vs prior year's $545.0M, implying $555.9-566.8M vs FactSet $559.7M
  • FY Guidance (Jan 2018):
    • EPS $0.34-0.44 vs prior guidance $0.28-0.40 and FactSet $0.33
    • Revenue +3.5-5% vs prior year's $2.21B, implying $2.29-2.32B vs prior 2-4% y/y growth and FactSet $2.25B
    • Constant currency revenue growth +4% to +5.5% vs prior +4% to +6%
  • Management comments:
    • CEO Victor Herrero: "We continued to see strong performance in our international businesses. In Europe and in Asia, our revenues were up 23% and 17% driven by new store openings and positive comp sales. We are also encouraged by the trends in adjusted operating margins for these two regions, as they expanded in the quarter relative to last year. In the Americas, as the performance of our business and the environment remain soft, we are more than ever focused on shrinking our footprint and profitability improvements."

PVH PVH Corp reports Q1 non-GAAP EPS $1.65 vs FactSet $1.60; raises FY guidance 

 Reports Q1:

  • Revenue $1.99B vs FactSet $1.96B
  • Q2 Guidance:
    • Non-GAAP EPS $1.60-1.63 vs FactSet $1.57
    • Revenue projected to increase ~5% (increase ~7% on a constant currency basis) vs FactSet +1.2%
  • FY Guidance (Jan 2018):
    • Non-GAAP EPS $7.40-7.50 vs prior guidance $7.30-7.40 and FactSet $7.40
    • Revenue projected to increase ~3% (increase ~5% on a constant currency basis) vs prior guidance +2% (or ~4% on a constant currency basis) and FactSet +2.4%

ANF Abercrombie & Fitch reports Q1 EPS ($0.91), including items 

  • Reports Q1:
    • Reported EPS includes:
      • Non-cash income tax charge of $0.14/share related to a change in share-based compensation accounting standards, as previously announced;
      • Adverse impact of ~$0.05/share related to a lower than expected core tax rate
      • EPS was ($0.72) excluding these items
        • FactSet consensus is ($0.70); not immediately clear which number, if either, is comparable
    • Revenue $661.1M vs FactSet $651.5M
    • Comps (3.0%) vs FactSet (3.1%)
  • FY17 Outlook:
    • Comparable sales to remain challenging in Q2, with trend improvement in H2 of the year
    • Continued adverse impact from foreign currency on sales and operating income
    • Gross margin rate down slightly to last year's adjusted non-GAAP rate of 61.0%, with continued pressure in Q2
    • Operating expense to be down at least 3% from last year's adjusted non-GAAP operating expense of $2.025B, with approximately 65% of the full year reduction to occur in H2 of the year
    • Net income attributable to noncontrolling interests of approximately $4M
    • Now expects the effective tax rate to reflect a core tax rate in the low 30s
    • Expects capital expenditures to be ~$100M for FY2017

DLTR Dollar Tree reports Q1 EPS $0.98 ex-items vs FactSet $0.98 

  • Reports Q1:
    • Revenue $5.29B vs FactSet $5.29B
  • Q2 Guidance:
    • Revenue $5.18-5.28B vs FactSet $5.24B
    • Comps slightly positive to low single-digit increase
  • FY Guidance (Jan 2018):
    • EPS $4.30-4.56 vs prior guidance $4.20-4.56 and FactSet $4.46
    • Revenue $21.95-22.25B vs prior guidance $21.94-22.33B and FactSet $22.12B
    • Comps slightly positive to low single-digit increase vs prior flat to +LSD

BBY Best Buy reports Q1 EPS $0.60 vs FactSet $0.40 

  • Reports Q1:
    • Revenue $8.53B vs FactSet $8.28B
    • Domestic comps +1.4% vs FactSet (1.8%) and guidance (2.5%)-(1.5%)
  • Q2 Guidance:
    • EPS $0.57-$0.62 vs FactSet $0.59
    • Revenue $8.6B-$8.7B vs FactSet $8.48B
    • Domestic comps +1.5%-2.5% vs. FactSet flat
  • FY Guidance (Jan 2018):
    • Enterprise revenue growth of approximately 2.5%. FactSet consensus implies growth of 1.4%
    • Enterprise non-GAAP operating income growth rate in the range of 3.5% to 8.5%, based on the recast FY17 non-GAAP operating income of $1.733B
    • Enterprise non-GAAP effective income tax rate of approximately 35.5%3
    • On a 52-week basis, Enterprise revenue growth of approximately 1.0%
    • On a 52-week basis, Enterprise non-GAAP operating income growth rate in the range of 1.5% to 5.5%, based on the recast FY17 non-GAAP operating income of $1.733B

SIG Signet Jewelers issues press release on agreement with Alliance Data (ADS), updates on outsourcing of credit portfolio 

  • Signet Jewelers announced the first phase of the strategic outsourcing of its in-house credit program and outlined steps to achieve a fully-outsourced program structure.
  • The first phase, which is designed to substantially maintain the full spectrum of Signet’s retail financing options and net sales, is expected to be fully implemented by October 2017 as outlined below:
    • Signet will sell $1.0B of its prime-only credit quality accounts receivable to Alliance Data Systems Corporation (ADS), as just reported

SIG Signet Jewelers reports Q1 EPS $1.03 

  • Reports Q1:
    • Including approximately $0.17 negative impact attributable to the later timing of Mother's Day holiday
    • FactSet EPS consens$1.67
    • Revenue $1.40B vs FactSet $1.47B
    • Comps (11.5%) vs FactSet (8.2%)
  • Reaffirms FY Guidance (Jan 2018):
    • EPS $7.00-7.40 vs FactSet $7.06
    • Down low-to-mid single-digit %

MOV Movado Group reports Q1 EPS $0.01 vs FactSet $0.10

  • Reports Q1:
    • Revenue $99.3M vs FactSet $97.3M -- 2 estimates
  • FY Guidance (Jan 2018):
    • Reaffirms EPS $1.40-$1.55 vs FactSet $1.43

GCO Genesco reports Q1 adjusted EPS $0.06

  • Reports Q1:
    • unclear if EPS is comparable to FactSet $0.27
    • Revenue $643.0M vs FactSet $644.7M
  • FY Guidance (Jan 2018):
    • EPS $3.90-4.05 vs prior guidance $4.40-4.55 and FactSet $4.44
      • guidance does not include expected non-cash asset impairments and other charges, estimated in the range of $5.3M to $6.3M pretax, or $0.18 to $0.21 per share after tax, for the full fiscal year.
      • They also do not include certain tax effects related to equity grants pursuant to the newly effective ASU 2016-09, estimated at $0.09 per share after tax.
      • This guidance assumes comparable sales are flat to up to 1% for the full year.

FRED Fred's enters registration rights agreement with holder Alden 

  • As contemplated by the terms of the Cooperation agreement, dated 21-Apr-17, by and among Fred’s, Inc. , Alden Global Capital LLC, Strategic Investment Opportunities LLC, and Heath B. Freeman, on 24-May-17, the company entered into a Registration Rights agreement with Alden Global Capital LLC and Strategic Investment Opportunities LLC .
  • Pursuant to the Registration Rights agreement, the Alden Shareholders may make up to four requests that the company file a registration statement to register the sale of shares of the company’s common stock that the Alden Shareholders beneficially own, subject to the limitations and conditions provided in the Registration Rights agreement.

CBK Christopher & Banks reports Q1 EPS ($0.10) vs FactSet ($0.15) -- 1 estimate 

  • Reports Q1:
    • Revenue $88.6M vs FactSet $86.9M -- 1 estimate
    • EBITDA ($0.4M) vs FactSet ($2.3M) -- 1 estimate
    • Comparable sales decreased 8.9% following a 6.2% increase in the same period last year. eCommerce sales increased 14.7%

SHLD Sears Holdings reports Q1 adjusted EPS ($2.15) 

  • Reports Q1:
    • FactSet EPS consensus ($0.72) -- 2 estimates
    • Revenue $4.30B vs FactSet $4.05B -- 2 estimates
    • Adjusted EBITDA ($222.0M) vs FactSet ($212.6M)

CWH Camping World announces 9.5M shares price at $27.75/sh through Goldman Sachs and JP Morgan

CPRT Copart reports Q3 EPS $0.37 vs FactSet $0.36 

  • Reports Q3:
    • Revenue $373.9M vs FactSet $386.6M

CONN Conn's discloses departure of Michael Poppe, President and COO 

  • Until a successor COO is appointed, Norman L. Miller, the company’s CEO, will assume the duties of the COO position.

S&P changes: IHS Markit to replace Tegna (TGNA) in S&P 500, more... 

  • IHS Markit Ltd. (INFO) will replace TEGNA Inc. (TGNA) in the S&P 500,
  • TEGNA and Cars.com (CARS) will replace J.C. Penney Company Inc. (JCP) and
  • Time Inc. (TIME) respectively in the S&P MidCap 400, and
  • J.C. Penney and TIME will replace Tuesday Morning Corp. (TUES) and Hornbeck Offshore Services Inc. (HOS) respectively in the S&P SmallCap 600
    • all of the above effective prior to the open on Friday, 2-Jun.
  • Independence Realty Trust, Inc. (IRT) will replace Ultratech Inc. (UTEK) in the S&P SmallCap 600 effective prior to the open on Tuesday, 30-May.

EVLV EVINE Live to sell 4M shares for $1.12 per share in registered direct offering 

  • Evine Live entered into definitive purchase agreements with several investors to sell an aggregate of approximately 4M shares of its common stock at a purchase price of $1.12 per share in a registered direct offering, except for shares sold to certain directors and executive officers of the company, who will pay $1.15 per share.
  • The offering is expected to close on or about 30-May-17.
  • The offering was made without the use of a placement agent or underwriter.

WSM Williams-Sonoma reports Q1 EPS $0.51 ex-items vs FactSet $0.49 

  • Reports Q1:
    • Revenue $1.11B vs FactSet $1.11B
  • Q2 Guidance:
    • EPS $01.55-0.61 vs FactSet $0.60
    • Revenue $1.195-1.23B vs FactSet $1.19B
    • Comparable Brand Revenue Growth 2% – 5%
  • FY Guidance (Jan 2018):
    • EPS $3.45-3.65 vs FactSet $3.54
    • Revenue $5.165-5.265B vs FactSet $5.20B
    • Comparable Brand Revenue Growth 1% – 3%
    • Non-GAAP Operating Margin 9.4% – 9.6%
    • Capex 200-220M

SCVL Shoe Carnival reports Q1 EPS $0.48 vs FactSet $0.49 

  • Reports Q1:
    • Revenue $253.4M vs FactSet $254.8M -- 2 estimates
    • Comps (3.9%), as reported 2-May
  • Repeats FY Guidance (Jan 2018):
    • EPS $1.30-1.45 vs FactSet $1.38
    • Revenue $1.002-1.018B vs FactSet $1.01B
    • Comparable store sales flat to down low single digits

SPTN SpartanNash reports Q1 EPS $0.55 ex-items vs FactSet $0.54 

  • Reports Q1:
    • Revenue $2.40B vs FactSet $2.46B
    • Adjusted EBITDA $70.2M vs FactSet $65.9M
  • FY Guidance (Dec 2017):
    • Reaffirms EPS $2.26-2.35 ex-items vs FactSet $2.32

BURL Burlington Stores reports Q1 adjusted EPS $0.79 vs FactSet $0.70 

  • Reports Q1:
    • Total sales $1.35B vs FactSet $1.36B
    • Adjusted EBITDA $136.8M vs FactSet $135.6M
    • Comps +0.5% vs FactSet +2.4% and guidance +1-2%
  • Q2 Guidance:
    • Adjusted EPS $0.46-0.50 vs FactSet $0.50
    • Comps +2-3% vs FactSet +3.0%
    • Total sales +6.7-7.7% vs FactSet $1.35B, implying 7.2% growth
  • FY Guidance (Jan 2018):
    • Adjusted EPS $3.86-3.96 vs prior guidance $3.77-3.87 and FactSet $3.89
    • Total sales +7.3-8.1% vs prior guidance +7.5-8.5%
    • Reaffirms comps +2-3% vs FactSet +3.0%
    • Open 30 net new stores

Stocks mentioned on CNBC's Mad Money with Jim Cramer -- TheStreet 

  • CEO Interview: Cramer talked to Manny Chirico, chairman and CEO of PVH Corp (PVH). Chirico said the retail industry continues to see a "seismic shift" in distribution channels and that there are just too many stores. Chirico also noted that this year's late Easter holiday seemed to take retailers and investors by surprise, but those kinks have not worked themselves out. Cramer continued to be bullish on PVH.
  • Brief Mention/Positive: HD, FL, CARA, NGG, EXPE, FDX

BTN Ballantyne Strong reports Q1 GAAP EPS cont. ops. $0.03 vs year-ago ($0.05) -- 10-Q 

  • Reports Q1:
    • Revenue $18.0M vs year-ago $17.1M

SAFM Sanderson Farms reports Q2 GAAP EPS $2.94 vs year-ago $2.11 -- 10-Q 

  • Reports Q2:
    • Revenue $802.0M vs FactSet $770.7M

NOMD Nomad Foods reports Q1 adjusted EPS €0.25 vs FactSet €0.24 

  • Reports Q1:
    • Revenue €531.3M vs FactSet €527.2M
    • Adjusted EBITDA €88.8M vsFactSet €88.2M
  • FY Guidance (Dec 2017):
    • Adjusted EBITDA €315M-325M vs prior €315, FactSet €312.7M
  • Management comments:
    • "As expected, Q1 gross margins reflect higher planned promotions to help ease price increases into the UK market. We are pleased with the execution of these actions and expect promotions to moderate in Q2. Based on our year-to-date performance and increased visibility into the year, we are increasing our 2017 guidance."

HRL Hormel Foods reports Q2 EPS $0.39 vs FactSet $0.40 

  • Reports Q2:
    • Revenue $2.19B vs FactSet $2.23B
  • FY Guidance (Oct 2017):
    • Maintains EPS $1.65-1.71 but expect the results at Jennie-O Turkey Store to push full-year earnings toward the lower end of this range
      • FactSet consensus is $1.66
  • Management comments:
    • "Despite ongoing challenges in the turkey industry, our balanced model allowed us to deliver earnings within two percent of last year's results,"
    • "Three segments delivered earnings growth, margin expansion, and adjusted volume and sales growth this quarter."
    • "Growth in many of our key brands drove excellent results in the Grocery Products and International segments.
    • "The divestitures of Farmer John and Diamond Crystal Brands allowed Refrigerated Foods and Specialty Foods to enhance their operating margins,"
    • "Unfavorable market conditions in the turkey industry caused by an oversupply of turkey continued to pressure Jennie-O Turkey Store sales and earnings."

 

Events

MOD Modine Manufacturing reports Q4 EPS $0.35 ex-items vs FactSet $0.34 

  • Reports Q4:
    • Revenue $488.3M vs FactSet $468.4M -- 2 estimates
  • FY Guidance (Mar 2018):
    • EPS $1.20-1.35 vs FactSet $1.13
    • Revenue +25-30% vs prior year's $1.50B, implying $1.88-1.95B vs FactSet $1.86B
    • EBITDA $175-185M vs FactSet $169.3M
  • Management comments:
    • President and CEO, Thomas Burke: "Our base business also returned to growth in Q4, driven in part by significant increases in Asia and market improvements. We are very pleased with the integration of the CIS organization into Modine, and we remain on track to deliver annual cost synergies of at least $15M within the next three to four years.
GES Guess? reports Q1 EPS ($0.24) vs FactSet ($0.32)
  • Reports Q1:
    • Revenue $458.6M vs FactSet $449.2M
  • Q2 Guidance:
    • EPS $0.08-0.11 vs FactSet $0.12
    • Revenue +2-4% vs prior year's $545.0M, implying $555.9-566.8M vs FactSet $559.7M
  • FY Guidance (Jan 2018):
    • EPS $0.34-0.44 vs prior guidance $0.28-0.40 and FactSet $0.33
    • Revenue +3.5-5% vs prior year's $2.21B, implying $2.29-2.32B vs prior 2-4% y/y growth and FactSet $2.25B
    • Constant currency revenue growth +4% to +5.5% vs prior +4% to +6%
  • Management comments:
    • CEO Victor Herrero: "We continued to see strong performance in our international businesses. In Europe and in Asia, our revenues were up 23% and 17% driven by new store openings and positive comp sales. We are also encouraged by the trends in adjusted operating margins for these two regions, as they expanded in the quarter relative to last year. In the Americas, as the performance of our business and the environment remain soft, we are more than ever focused on shrinking our footprint and profitability improvements."

PVH PVH Corp reports Q1 non-GAAP EPS $1.65 vs FactSet $1.60; raises FY guidance 

 Reports Q1:

  • Revenue $1.99B vs FactSet $1.96B
  • Q2 Guidance:
    • Non-GAAP EPS $1.60-1.63 vs FactSet $1.57
    • Revenue projected to increase ~5% (increase ~7% on a constant currency basis) vs FactSet +1.2%
  • FY Guidance (Jan 2018):
    • Non-GAAP EPS $7.40-7.50 vs prior guidance $7.30-7.40 and FactSet $7.40
    • Revenue projected to increase ~3% (increase ~5% on a constant currency basis) vs prior guidance +2% (or ~4% on a constant currency basis) and FactSet +2.4%

ANF Abercrombie & Fitch reports Q1 EPS ($0.91), including items 

  • Reports Q1:
    • Reported EPS includes:
      • Non-cash income tax charge of $0.14/share related to a change in share-based compensation accounting standards, as previously announced;
      • Adverse impact of ~$0.05/share related to a lower than expected core tax rate
      • EPS was ($0.72) excluding these items
        • FactSet consensus is ($0.70); not immediately clear which number, if either, is comparable
    • Revenue $661.1M vs FactSet $651.5M
    • Comps (3.0%) vs FactSet (3.1%)
  • FY17 Outlook:
    • Comparable sales to remain challenging in Q2, with trend improvement in H2 of the year
    • Continued adverse impact from foreign currency on sales and operating income
    • Gross margin rate down slightly to last year's adjusted non-GAAP rate of 61.0%, with continued pressure in Q2
    • Operating expense to be down at least 3% from last year's adjusted non-GAAP operating expense of $2.025B, with approximately 65% of the full year reduction to occur in H2 of the year
    • Net income attributable to noncontrolling interests of approximately $4M
    • Now expects the effective tax rate to reflect a core tax rate in the low 30s
    • Expects capital expenditures to be ~$100M for FY2017

DLTR Dollar Tree reports Q1 EPS $0.98 ex-items vs FactSet $0.98 

  • Reports Q1:
    • Revenue $5.29B vs FactSet $5.29B
  • Q2 Guidance:
    • Revenue $5.18-5.28B vs FactSet $5.24B
    • Comps slightly positive to low single-digit increase
  • FY Guidance (Jan 2018):
    • EPS $4.30-4.56 vs prior guidance $4.20-4.56 and FactSet $4.46
    • Revenue $21.95-22.25B vs prior guidance $21.94-22.33B and FactSet $22.12B
    • Comps slightly positive to low single-digit increase vs prior flat to +LSD

BBY Best Buy reports Q1 EPS $0.60 vs FactSet $0.40 

  • Reports Q1:
    • Revenue $8.53B vs FactSet $8.28B
    • Domestic comps +1.4% vs FactSet (1.8%) and guidance (2.5%)-(1.5%)
  • Q2 Guidance:
    • EPS $0.57-$0.62 vs FactSet $0.59
    • Revenue $8.6B-$8.7B vs FactSet $8.48B
    • Domestic comps +1.5%-2.5% vs. FactSet flat
  • FY Guidance (Jan 2018):
    • Enterprise revenue growth of approximately 2.5%. FactSet consensus implies growth of 1.4%
    • Enterprise non-GAAP operating income growth rate in the range of 3.5% to 8.5%, based on the recast FY17 non-GAAP operating income of $1.733B
    • Enterprise non-GAAP effective income tax rate of approximately 35.5%3
    • On a 52-week basis, Enterprise revenue growth of approximately 1.0%
    • On a 52-week basis, Enterprise non-GAAP operating income growth rate in the range of 1.5% to 5.5%, based on the recast FY17 non-GAAP operating income of $1.733B

SIG Signet Jewelers issues press release on agreement with Alliance Data (ADS), updates on outsourcing of credit portfolio 

  • Signet Jewelers announced the first phase of the strategic outsourcing of its in-house credit program and outlined steps to achieve a fully-outsourced program structure.
  • The first phase, which is designed to substantially maintain the full spectrum of Signet’s retail financing options and net sales, is expected to be fully implemented by October 2017 as outlined below:
    • Signet will sell $1.0B of its prime-only credit quality accounts receivable to Alliance Data Systems Corporation (ADS), as just reported

SIG Signet Jewelers reports Q1 EPS $1.03 

  • Reports Q1:
    • Including approximately $0.17 negative impact attributable to the later timing of Mother's Day holiday
    • FactSet EPS consens$1.67
    • Revenue $1.40B vs FactSet $1.47B
    • Comps (11.5%) vs FactSet (8.2%)
  • Reaffirms FY Guidance (Jan 2018):
    • EPS $7.00-7.40 vs FactSet $7.06
    • Down low-to-mid single-digit %

MOV Movado Group reports Q1 EPS $0.01 vs FactSet $0.10

  • Reports Q1:
    • Revenue $99.3M vs FactSet $97.3M -- 2 estimates
  • FY Guidance (Jan 2018):
    • Reaffirms EPS $1.40-$1.55 vs FactSet $1.43

GCO Genesco reports Q1 adjusted EPS $0.06

  • Reports Q1:
    • unclear if EPS is comparable to FactSet $0.27
    • Revenue $643.0M vs FactSet $644.7M
  • FY Guidance (Jan 2018):
    • EPS $3.90-4.05 vs prior guidance $4.40-4.55 and FactSet $4.44
      • guidance does not include expected non-cash asset impairments and other charges, estimated in the range of $5.3M to $6.3M pretax, or $0.18 to $0.21 per share after tax, for the full fiscal year.
      • They also do not include certain tax effects related to equity grants pursuant to the newly effective ASU 2016-09, estimated at $0.09 per share after tax.
      • This guidance assumes comparable sales are flat to up to 1% for the full year.

FRED Fred's enters registration rights agreement with holder Alden 

  • As contemplated by the terms of the Cooperation agreement, dated 21-Apr-17, by and among Fred’s, Inc. , Alden Global Capital LLC, Strategic Investment Opportunities LLC, and Heath B. Freeman, on 24-May-17, the company entered into a Registration Rights agreement with Alden Global Capital LLC and Strategic Investment Opportunities LLC .
  • Pursuant to the Registration Rights agreement, the Alden Shareholders may make up to four requests that the company file a registration statement to register the sale of shares of the company’s common stock that the Alden Shareholders beneficially own, subject to the limitations and conditions provided in the Registration Rights agreement.

CBK Christopher & Banks reports Q1 EPS ($0.10) vs FactSet ($0.15) -- 1 estimate 

  • Reports Q1:
    • Revenue $88.6M vs FactSet $86.9M -- 1 estimate
    • EBITDA ($0.4M) vs FactSet ($2.3M) -- 1 estimate
    • Comparable sales decreased 8.9% following a 6.2% increase in the same period last year. eCommerce sales increased 14.7%

SHLD Sears Holdings reports Q1 adjusted EPS ($2.15) 

  • Reports Q1:
    • FactSet EPS consensus ($0.72) -- 2 estimates
    • Revenue $4.30B vs FactSet $4.05B -- 2 estimates
    • Adjusted EBITDA ($222.0M) vs FactSet ($212.6M)

CWH Camping World announces 9.5M shares price at $27.75/sh through Goldman Sachs and JP Morgan

CPRT Copart reports Q3 EPS $0.37 vs FactSet $0.36 

  • Reports Q3:
    • Revenue $373.9M vs FactSet $386.6M

CONN Conn's discloses departure of Michael Poppe, President and COO 

  • Until a successor COO is appointed, Norman L. Miller, the company’s CEO, will assume the duties of the COO position.

S&P changes: IHS Markit to replace Tegna (TGNA) in S&P 500, more... 

  • IHS Markit Ltd. (INFO) will replace TEGNA Inc. (TGNA) in the S&P 500,
  • TEGNA and Cars.com (CARS) will replace J.C. Penney Company Inc. (JCP) and
  • Time Inc. (TIME) respectively in the S&P MidCap 400, and
  • J.C. Penney and TIME will replace Tuesday Morning Corp. (TUES) and Hornbeck Offshore Services Inc. (HOS) respectively in the S&P SmallCap 600
    • all of the above effective prior to the open on Friday, 2-Jun.
  • Independence Realty Trust, Inc. (IRT) will replace Ultratech Inc. (UTEK) in the S&P SmallCap 600 effective prior to the open on Tuesday, 30-May.

EVLV EVINE Live to sell 4M shares for $1.12 per share in registered direct offering 

  • Evine Live entered into definitive purchase agreements with several investors to sell an aggregate of approximately 4M shares of its common stock at a purchase price of $1.12 per share in a registered direct offering, except for shares sold to certain directors and executive officers of the company, who will pay $1.15 per share.
  • The offering is expected to close on or about 30-May-17.
  • The offering was made without the use of a placement agent or underwriter.

WSM Williams-Sonoma reports Q1 EPS $0.51 ex-items vs FactSet $0.49 

  • Reports Q1:
    • Revenue $1.11B vs FactSet $1.11B
  • Q2 Guidance:
    • EPS $01.55-0.61 vs FactSet $0.60
    • Revenue $1.195-1.23B vs FactSet $1.19B
    • Comparable Brand Revenue Growth 2% – 5%
  • FY Guidance (Jan 2018):
    • EPS $3.45-3.65 vs FactSet $3.54
    • Revenue $5.165-5.265B vs FactSet $5.20B
    • Comparable Brand Revenue Growth 1% – 3%
    • Non-GAAP Operating Margin 9.4% – 9.6%
    • Capex 200-220M

SCVL Shoe Carnival reports Q1 EPS $0.48 vs FactSet $0.49 

  • Reports Q1:
    • Revenue $253.4M vs FactSet $254.8M -- 2 estimates
    • Comps (3.9%), as reported 2-May
  • Repeats FY Guidance (Jan 2018):
    • EPS $1.30-1.45 vs FactSet $1.38
    • Revenue $1.002-1.018B vs FactSet $1.01B
    • Comparable store sales flat to down low single digits

SPTN SpartanNash reports Q1 EPS $0.55 ex-items vs FactSet $0.54 

  • Reports Q1:
    • Revenue $2.40B vs FactSet $2.46B
    • Adjusted EBITDA $70.2M vs FactSet $65.9M
  • FY Guidance (Dec 2017):
    • Reaffirms EPS $2.26-2.35 ex-items vs FactSet $2.32

BURL Burlington Stores reports Q1 adjusted EPS $0.79 vs FactSet $0.70 

  • Reports Q1:
    • Total sales $1.35B vs FactSet $1.36B
    • Adjusted EBITDA $136.8M vs FactSet $135.6M
    • Comps +0.5% vs FactSet +2.4% and guidance +1-2%
  • Q2 Guidance:
    • Adjusted EPS $0.46-0.50 vs FactSet $0.50
    • Comps +2-3% vs FactSet +3.0%
    • Total sales +6.7-7.7% vs FactSet $1.35B, implying 7.2% growth
  • FY Guidance (Jan 2018):
    • Adjusted EPS $3.86-3.96 vs prior guidance $3.77-3.87 and FactSet $3.89
    • Total sales +7.3-8.1% vs prior guidance +7.5-8.5%
    • Reaffirms comps +2-3% vs FactSet +3.0%
    • Open 30 net new stores

Stocks mentioned on CNBC's Mad Money with Jim Cramer -- TheStreet 

  • CEO Interview: Cramer talked to Manny Chirico, chairman and CEO of PVH Corp (PVH). Chirico said the retail industry continues to see a "seismic shift" in distribution channels and that there are just too many stores. Chirico also noted that this year's late Easter holiday seemed to take retailers and investors by surprise, but those kinks have not worked themselves out. Cramer continued to be bullish on PVH.
  • Brief Mention/Positive: HD, FL, CARA, NGG, EXPE, FDX

BTN Ballantyne Strong reports Q1 GAAP EPS cont. ops. $0.03 vs year-ago ($0.05) -- 10-Q 

  • Reports Q1:
    • Revenue $18.0M vs year-ago $17.1M

SAFM Sanderson Farms reports Q2 GAAP EPS $2.94 vs year-ago $2.11 -- 10-Q 

  • Reports Q2:
    • Revenue $802.0M vs FactSet $770.7M

NOMD Nomad Foods reports Q1 adjusted EPS €0.25 vs FactSet €0.24 

  • Reports Q1:
    • Revenue €531.3M vs FactSet €527.2M
    • Adjusted EBITDA €88.8M vsFactSet €88.2M
  • FY Guidance (Dec 2017):
    • Adjusted EBITDA €315M-325M vs prior €315, FactSet €312.7M
  • Management comments:
    • "As expected, Q1 gross margins reflect higher planned promotions to help ease price increases into the UK market. We are pleased with the execution of these actions and expect promotions to moderate in Q2. Based on our year-to-date performance and increased visibility into the year, we are increasing our 2017 guidance."

HRL Hormel Foods reports Q2 EPS $0.39 vs FactSet $0.40 

  • Reports Q2:
    • Revenue $2.19B vs FactSet $2.23B
  • FY Guidance (Oct 2017):
    • Maintains EPS $1.65-1.71 but expect the results at Jennie-O Turkey Store to push full-year earnings toward the lower end of this range
      • FactSet consensus is $1.66
  • Management comments:
    • "Despite ongoing challenges in the turkey industry, our balanced model allowed us to deliver earnings within two percent of last year's results,"
    • "Three segments delivered earnings growth, margin expansion, and adjusted volume and sales growth this quarter."
    • "Growth in many of our key brands drove excellent results in the Grocery Products and International segments.
    • "The divestitures of Farmer John and Diamond Crystal Brands allowed Refrigerated Foods and Specialty Foods to enhance their operating margins,"
    • "Unfavorable market conditions in the turkey industry caused by an oversupply of turkey continued to pressure Jennie-O Turkey Store sales and earnings."

 

Upgrades/ Downgrades

MOD Modine Manufacturing reports Q4 EPS $0.35 ex-items vs FactSet $0.34 

  • Reports Q4:
    • Revenue $488.3M vs FactSet $468.4M -- 2 estimates
  • FY Guidance (Mar 2018):
    • EPS $1.20-1.35 vs FactSet $1.13
    • Revenue +25-30% vs prior year's $1.50B, implying $1.88-1.95B vs FactSet $1.86B
    • EBITDA $175-185M vs FactSet $169.3M
  • Management comments:
    • President and CEO, Thomas Burke: "Our base business also returned to growth in Q4, driven in part by significant increases in Asia and market improvements. We are very pleased with the integration of the CIS organization into Modine, and we remain on track to deliver annual cost synergies of at least $15M within the next three to four years.
GES Guess? reports Q1 EPS ($0.24) vs FactSet ($0.32)
  • Reports Q1:
    • Revenue $458.6M vs FactSet $449.2M
  • Q2 Guidance:
    • EPS $0.08-0.11 vs FactSet $0.12
    • Revenue +2-4% vs prior year's $545.0M, implying $555.9-566.8M vs FactSet $559.7M
  • FY Guidance (Jan 2018):
    • EPS $0.34-0.44 vs prior guidance $0.28-0.40 and FactSet $0.33
    • Revenue +3.5-5% vs prior year's $2.21B, implying $2.29-2.32B vs prior 2-4% y/y growth and FactSet $2.25B
    • Constant currency revenue growth +4% to +5.5% vs prior +4% to +6%
  • Management comments:
    • CEO Victor Herrero: "We continued to see strong performance in our international businesses. In Europe and in Asia, our revenues were up 23% and 17% driven by new store openings and positive comp sales. We are also encouraged by the trends in adjusted operating margins for these two regions, as they expanded in the quarter relative to last year. In the Americas, as the performance of our business and the environment remain soft, we are more than ever focused on shrinking our footprint and profitability improvements."

PVH PVH Corp reports Q1 non-GAAP EPS $1.65 vs FactSet $1.60; raises FY guidance 

 Reports Q1:

  • Revenue $1.99B vs FactSet $1.96B
  • Q2 Guidance:
    • Non-GAAP EPS $1.60-1.63 vs FactSet $1.57
    • Revenue projected to increase ~5% (increase ~7% on a constant currency basis) vs FactSet +1.2%
  • FY Guidance (Jan 2018):
    • Non-GAAP EPS $7.40-7.50 vs prior guidance $7.30-7.40 and FactSet $7.40
    • Revenue projected to increase ~3% (increase ~5% on a constant currency basis) vs prior guidance +2% (or ~4% on a constant currency basis) and FactSet +2.4%

ANF Abercrombie & Fitch reports Q1 EPS ($0.91), including items 

  • Reports Q1:
    • Reported EPS includes:
      • Non-cash income tax charge of $0.14/share related to a change in share-based compensation accounting standards, as previously announced;
      • Adverse impact of ~$0.05/share related to a lower than expected core tax rate
      • EPS was ($0.72) excluding these items
        • FactSet consensus is ($0.70); not immediately clear which number, if either, is comparable
    • Revenue $661.1M vs FactSet $651.5M
    • Comps (3.0%) vs FactSet (3.1%)
  • FY17 Outlook:
    • Comparable sales to remain challenging in Q2, with trend improvement in H2 of the year
    • Continued adverse impact from foreign currency on sales and operating income
    • Gross margin rate down slightly to last year's adjusted non-GAAP rate of 61.0%, with continued pressure in Q2
    • Operating expense to be down at least 3% from last year's adjusted non-GAAP operating expense of $2.025B, with approximately 65% of the full year reduction to occur in H2 of the year
    • Net income attributable to noncontrolling interests of approximately $4M
    • Now expects the effective tax rate to reflect a core tax rate in the low 30s
    • Expects capital expenditures to be ~$100M for FY2017

DLTR Dollar Tree reports Q1 EPS $0.98 ex-items vs FactSet $0.98 

  • Reports Q1:
    • Revenue $5.29B vs FactSet $5.29B
  • Q2 Guidance:
    • Revenue $5.18-5.28B vs FactSet $5.24B
    • Comps slightly positive to low single-digit increase
  • FY Guidance (Jan 2018):
    • EPS $4.30-4.56 vs prior guidance $4.20-4.56 and FactSet $4.46
    • Revenue $21.95-22.25B vs prior guidance $21.94-22.33B and FactSet $22.12B
    • Comps slightly positive to low single-digit increase vs prior flat to +LSD

BBY Best Buy reports Q1 EPS $0.60 vs FactSet $0.40 

  • Reports Q1:
    • Revenue $8.53B vs FactSet $8.28B
    • Domestic comps +1.4% vs FactSet (1.8%) and guidance (2.5%)-(1.5%)
  • Q2 Guidance:
    • EPS $0.57-$0.62 vs FactSet $0.59
    • Revenue $8.6B-$8.7B vs FactSet $8.48B
    • Domestic comps +1.5%-2.5% vs. FactSet flat
  • FY Guidance (Jan 2018):
    • Enterprise revenue growth of approximately 2.5%. FactSet consensus implies growth of 1.4%
    • Enterprise non-GAAP operating income growth rate in the range of 3.5% to 8.5%, based on the recast FY17 non-GAAP operating income of $1.733B
    • Enterprise non-GAAP effective income tax rate of approximately 35.5%3
    • On a 52-week basis, Enterprise revenue growth of approximately 1.0%
    • On a 52-week basis, Enterprise non-GAAP operating income growth rate in the range of 1.5% to 5.5%, based on the recast FY17 non-GAAP operating income of $1.733B

SIG Signet Jewelers issues press release on agreement with Alliance Data (ADS), updates on outsourcing of credit portfolio 

  • Signet Jewelers announced the first phase of the strategic outsourcing of its in-house credit program and outlined steps to achieve a fully-outsourced program structure.
  • The first phase, which is designed to substantially maintain the full spectrum of Signet’s retail financing options and net sales, is expected to be fully implemented by October 2017 as outlined below:
    • Signet will sell $1.0B of its prime-only credit quality accounts receivable to Alliance Data Systems Corporation (ADS), as just reported

SIG Signet Jewelers reports Q1 EPS $1.03 

  • Reports Q1:
    • Including approximately $0.17 negative impact attributable to the later timing of Mother's Day holiday
    • FactSet EPS consens$1.67
    • Revenue $1.40B vs FactSet $1.47B
    • Comps (11.5%) vs FactSet (8.2%)
  • Reaffirms FY Guidance (Jan 2018):
    • EPS $7.00-7.40 vs FactSet $7.06
    • Down low-to-mid single-digit %

MOV Movado Group reports Q1 EPS $0.01 vs FactSet $0.10

  • Reports Q1:
    • Revenue $99.3M vs FactSet $97.3M -- 2 estimates
  • FY Guidance (Jan 2018):
    • Reaffirms EPS $1.40-$1.55 vs FactSet $1.43

GCO Genesco reports Q1 adjusted EPS $0.06

  • Reports Q1:
    • unclear if EPS is comparable to FactSet $0.27
    • Revenue $643.0M vs FactSet $644.7M
  • FY Guidance (Jan 2018):
    • EPS $3.90-4.05 vs prior guidance $4.40-4.55 and FactSet $4.44
      • guidance does not include expected non-cash asset impairments and other charges, estimated in the range of $5.3M to $6.3M pretax, or $0.18 to $0.21 per share after tax, for the full fiscal year.
      • They also do not include certain tax effects related to equity grants pursuant to the newly effective ASU 2016-09, estimated at $0.09 per share after tax.
      • This guidance assumes comparable sales are flat to up to 1% for the full year.

FRED Fred's enters registration rights agreement with holder Alden 

  • As contemplated by the terms of the Cooperation agreement, dated 21-Apr-17, by and among Fred’s, Inc. , Alden Global Capital LLC, Strategic Investment Opportunities LLC, and Heath B. Freeman, on 24-May-17, the company entered into a Registration Rights agreement with Alden Global Capital LLC and Strategic Investment Opportunities LLC .
  • Pursuant to the Registration Rights agreement, the Alden Shareholders may make up to four requests that the company file a registration statement to register the sale of shares of the company’s common stock that the Alden Shareholders beneficially own, subject to the limitations and conditions provided in the Registration Rights agreement.

CBK Christopher & Banks reports Q1 EPS ($0.10) vs FactSet ($0.15) -- 1 estimate 

  • Reports Q1:
    • Revenue $88.6M vs FactSet $86.9M -- 1 estimate
    • EBITDA ($0.4M) vs FactSet ($2.3M) -- 1 estimate
    • Comparable sales decreased 8.9% following a 6.2% increase in the same period last year. eCommerce sales increased 14.7%

SHLD Sears Holdings reports Q1 adjusted EPS ($2.15) 

  • Reports Q1:
    • FactSet EPS consensus ($0.72) -- 2 estimates
    • Revenue $4.30B vs FactSet $4.05B -- 2 estimates
    • Adjusted EBITDA ($222.0M) vs FactSet ($212.6M)

CWH Camping World announces 9.5M shares price at $27.75/sh through Goldman Sachs and JP Morgan

CPRT Copart reports Q3 EPS $0.37 vs FactSet $0.36 

  • Reports Q3:
    • Revenue $373.9M vs FactSet $386.6M

CONN Conn's discloses departure of Michael Poppe, President and COO 

  • Until a successor COO is appointed, Norman L. Miller, the company’s CEO, will assume the duties of the COO position.

S&P changes: IHS Markit to replace Tegna (TGNA) in S&P 500, more... 

  • IHS Markit Ltd. (INFO) will replace TEGNA Inc. (TGNA) in the S&P 500,
  • TEGNA and Cars.com (CARS) will replace J.C. Penney Company Inc. (JCP) and
  • Time Inc. (TIME) respectively in the S&P MidCap 400, and
  • J.C. Penney and TIME will replace Tuesday Morning Corp. (TUES) and Hornbeck Offshore Services Inc. (HOS) respectively in the S&P SmallCap 600
    • all of the above effective prior to the open on Friday, 2-Jun.
  • Independence Realty Trust, Inc. (IRT) will replace Ultratech Inc. (UTEK) in the S&P SmallCap 600 effective prior to the open on Tuesday, 30-May.

EVLV EVINE Live to sell 4M shares for $1.12 per share in registered direct offering 

  • Evine Live entered into definitive purchase agreements with several investors to sell an aggregate of approximately 4M shares of its common stock at a purchase price of $1.12 per share in a registered direct offering, except for shares sold to certain directors and executive officers of the company, who will pay $1.15 per share.
  • The offering is expected to close on or about 30-May-17.
  • The offering was made without the use of a placement agent or underwriter.

WSM Williams-Sonoma reports Q1 EPS $0.51 ex-items vs FactSet $0.49 

  • Reports Q1:
    • Revenue $1.11B vs FactSet $1.11B
  • Q2 Guidance:
    • EPS $01.55-0.61 vs FactSet $0.60
    • Revenue $1.195-1.23B vs FactSet $1.19B
    • Comparable Brand Revenue Growth 2% – 5%
  • FY Guidance (Jan 2018):
    • EPS $3.45-3.65 vs FactSet $3.54
    • Revenue $5.165-5.265B vs FactSet $5.20B
    • Comparable Brand Revenue Growth 1% – 3%
    • Non-GAAP Operating Margin 9.4% – 9.6%
    • Capex 200-220M

SCVL Shoe Carnival reports Q1 EPS $0.48 vs FactSet $0.49 

  • Reports Q1:
    • Revenue $253.4M vs FactSet $254.8M -- 2 estimates
    • Comps (3.9%), as reported 2-May
  • Repeats FY Guidance (Jan 2018):
    • EPS $1.30-1.45 vs FactSet $1.38
    • Revenue $1.002-1.018B vs FactSet $1.01B
    • Comparable store sales flat to down low single digits

SPTN SpartanNash reports Q1 EPS $0.55 ex-items vs FactSet $0.54 

  • Reports Q1:
    • Revenue $2.40B vs FactSet $2.46B
    • Adjusted EBITDA $70.2M vs FactSet $65.9M
  • FY Guidance (Dec 2017):
    • Reaffirms EPS $2.26-2.35 ex-items vs FactSet $2.32

BURL Burlington Stores reports Q1 adjusted EPS $0.79 vs FactSet $0.70 

  • Reports Q1:
    • Total sales $1.35B vs FactSet $1.36B
    • Adjusted EBITDA $136.8M vs FactSet $135.6M
    • Comps +0.5% vs FactSet +2.4% and guidance +1-2%
  • Q2 Guidance:
    • Adjusted EPS $0.46-0.50 vs FactSet $0.50
    • Comps +2-3% vs FactSet +3.0%
    • Total sales +6.7-7.7% vs FactSet $1.35B, implying 7.2% growth
  • FY Guidance (Jan 2018):
    • Adjusted EPS $3.86-3.96 vs prior guidance $3.77-3.87 and FactSet $3.89
    • Total sales +7.3-8.1% vs prior guidance +7.5-8.5%
    • Reaffirms comps +2-3% vs FactSet +3.0%
    • Open 30 net new stores

Stocks mentioned on CNBC's Mad Money with Jim Cramer -- TheStreet 

  • CEO Interview: Cramer talked to Manny Chirico, chairman and CEO of PVH Corp (PVH). Chirico said the retail industry continues to see a "seismic shift" in distribution channels and that there are just too many stores. Chirico also noted that this year's late Easter holiday seemed to take retailers and investors by surprise, but those kinks have not worked themselves out. Cramer continued to be bullish on PVH.
  • Brief Mention/Positive: HD, FL, CARA, NGG, EXPE, FDX

BTN Ballantyne Strong reports Q1 GAAP EPS cont. ops. $0.03 vs year-ago ($0.05) -- 10-Q 

  • Reports Q1:
    • Revenue $18.0M vs year-ago $17.1M

SAFM Sanderson Farms reports Q2 GAAP EPS $2.94 vs year-ago $2.11 -- 10-Q 

  • Reports Q2:
    • Revenue $802.0M vs FactSet $770.7M

NOMD Nomad Foods reports Q1 adjusted EPS €0.25 vs FactSet €0.24 

  • Reports Q1:
    • Revenue €531.3M vs FactSet €527.2M
    • Adjusted EBITDA €88.8M vsFactSet €88.2M
  • FY Guidance (Dec 2017):
    • Adjusted EBITDA €315M-325M vs prior €315, FactSet €312.7M
  • Management comments:
    • "As expected, Q1 gross margins reflect higher planned promotions to help ease price increases into the UK market. We are pleased with the execution of these actions and expect promotions to moderate in Q2. Based on our year-to-date performance and increased visibility into the year, we are increasing our 2017 guidance."

HRL Hormel Foods reports Q2 EPS $0.39 vs FactSet $0.40 

  • Reports Q2:
    • Revenue $2.19B vs FactSet $2.23B
  • FY Guidance (Oct 2017):
    • Maintains EPS $1.65-1.71 but expect the results at Jennie-O Turkey Store to push full-year earnings toward the lower end of this range
      • FactSet consensus is $1.66
  • Management comments:
    • "Despite ongoing challenges in the turkey industry, our balanced model allowed us to deliver earnings within two percent of last year's results,"
    • "Three segments delivered earnings growth, margin expansion, and adjusted volume and sales growth this quarter."
    • "Growth in many of our key brands drove excellent results in the Grocery Products and International segments.
    • "The divestitures of Farmer John and Diamond Crystal Brands allowed Refrigerated Foods and Specialty Foods to enhance their operating margins,"
    • "Unfavorable market conditions in the turkey industry caused by an oversupply of turkey continued to pressure Jennie-O Turkey Store sales and earnings."

 

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Financial News

John Fay, Brad Berger (203) 861-7650 | 5.25.2017

News

Bank of the Ozarks announces 6.6M share common stock offering through J.P. Morgan Bank of the Ozarks 6.6M share offering priced for total estimated gross proceeds of $302.3M Expects to use the net proceeds to support the Company’s organic growth, including growth in non-purchased loans and leases, for potential future acquisitions, and for general corporate purposes StreetAccount notes this calculates to ~ $45.80/share

Sun Communities commences 3.5M share offering through BofA Merrill Lynch and Citi  The company intends to use the net proceeds of the offering to repay borrowings outstanding under the revolving loan under its senior credit facility, to fund possible future acquisitions and for working capital and general corporate purposes.  

LendingTree prices $265M Of Convertible Senior Notes, equivalent to initial conversion price of $207.63/sh  The size of the offering was increased from the previously announced $200M in aggregate principal amount.  The initial conversion rate for the notes is 4.8163 shares of the company's common stock per $1,000 principal amount of notes (which is equivalent to an initial conversion price of approximately $207.63 per share).

Kearny Financial authorized second stock repurchase plan to acquire up to 8,559,084 shares or 10% of currently outstanding common stock In conjunction with the commencement of a second stock repurchase plan, the Company also announced the completion of its first 10% stock repurchase plan. That plan, which was announced on May 20, 2016, authorized the repurchase of up to 9,352,809 shares. The Company ultimately repurchased 9,352,809 shares under that plan, at a total cost of $130.6 million and an average cost of $13.96 per share.

Independence Realty Trust, Inc. (IRT) will replace Ultratech Inc. (UTEK) in the S&P SmallCap 600 effective prior to the open on Tuesday, May 30. S&P SmallCap 600 constituent Veeco Instruments Inc. (VECO) is acquiring Ultratech in a deal expected to be completed on or about that date pending final conditions.

Upgrades/ Downgrades

Bank of the Ozarks announces 6.6M share common stock offering through J.P. Morgan Bank of the Ozarks 6.6M share offering priced for total estimated gross proceeds of $302.3M Expects to use the net proceeds to support the Company’s organic growth, including growth in non-purchased loans and leases, for potential future acquisitions, and for general corporate purposes StreetAccount notes this calculates to ~ $45.80/share

Sun Communities commences 3.5M share offering through BofA Merrill Lynch and Citi  The company intends to use the net proceeds of the offering to repay borrowings outstanding under the revolving loan under its senior credit facility, to fund possible future acquisitions and for working capital and general corporate purposes.  

LendingTree prices $265M Of Convertible Senior Notes, equivalent to initial conversion price of $207.63/sh  The size of the offering was increased from the previously announced $200M in aggregate principal amount.  The initial conversion rate for the notes is 4.8163 shares of the company's common stock per $1,000 principal amount of notes (which is equivalent to an initial conversion price of approximately $207.63 per share).

Kearny Financial authorized second stock repurchase plan to acquire up to 8,559,084 shares or 10% of currently outstanding common stock In conjunction with the commencement of a second stock repurchase plan, the Company also announced the completion of its first 10% stock repurchase plan. That plan, which was announced on May 20, 2016, authorized the repurchase of up to 9,352,809 shares. The Company ultimately repurchased 9,352,809 shares under that plan, at a total cost of $130.6 million and an average cost of $13.96 per share.

Independence Realty Trust, Inc. (IRT) will replace Ultratech Inc. (UTEK) in the S&P SmallCap 600 effective prior to the open on Tuesday, May 30. S&P SmallCap 600 constituent Veeco Instruments Inc. (VECO) is acquiring Ultratech in a deal expected to be completed on or about that date pending final conditions.

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Industrial News

 (203) 861-7650 | 5.25.2017

News

(LODE) Comstock Mining expects at least one transaction to occur during Q2 ($0.17)

  • Comstock reported it has significantly advanced two strategic venture discussions this week and anticipates that at least one transaction will occur during Q2.
  • Additionally, the company advanced metallurgical column tests from the Dayton Resource Area, for the purpose of assessing optimum metallurgical feasibility for the Dayton mineralized material.
  • The company has established four, full metallurgical column tests, two cyanide and two non-cyanide, running parallel, that support and advances the feasibility study for establishing proven and probable reserves at the Dayton Mine. The samples were crushed, agglomerated and loaded into four ten-foot columns for leach pad simulation. These simulations are entering their third week of testing
  • The company believes the three primary value drivers for the company’s valuation are the advancements of its Comstock properties toward feasibility, including the Dayton Mine, Joint Ventures that expand or accelerate these mine developments toward feasibility and the completion of the new USA Parkway and its roundabout connection into U.S. 50, both scheduled for completion this year.

(JELD) ELD-WEN Holding announces 14M share offering for holder Onex Partners priced at $30.75 per share ($31.21)

  • Through Barclays, Citi, Credit Suisse, JPMorgan, Deutsche Bank, RBC Capital, BofA Merrill Lynch, Goldman Sachs and Wells Fargo.

(WMS) Advanced Drainage Systems reports Q4 non-GAAP EPS ($0.22) vs FactSet $0.03 ($21.60) 

  • Reports Q4:
    • Revenue $244.2M vs FactSet $228.8M -- 2 estimates
    • Adjusted EBITDA $12.6M vs year-ago $21.6M
  • FY Guidance (Mar 2018):
    • Revenue $1.275-1.325B vs FactSet $1.31B
    • Adjusted EBITDA $200-220M vs FactSet $209.2M
  • Dividend:
    • Increases quarterly dividend to $0.07 from $0.06
    • Payable 15-Jun, of record 5-Jun
  • Management comments:
    • “As we enter fiscal 2018, we expect our strong performance in our core construction markets to continue, aided by improving sales in international coupled with a slower decline in Ag compared to the prior year.
    • "In addition, we will look to accelerate our growth through innovation, such as our recently launched HPXR 75 product line, as well as bolt-on acquisitions that complement our product suite and geographic footprint.
    • "Lastly, we are committed to improving our longer-term margin profile through performance improvement initiatives focused on operational and customer excellence.
    • "Overall, we feel very good about our position in the markets we serve and our ability to continue driving above-market growth and operating leverage over time.”

(PWR) Quanta Services board authorizes $300M repurchase program, effective through 30-Jun 2020 ($31.28)

 

(VMC) Vulcan announces agreement to acquire Aggregates USA LLC for $900M cash ($125.12) 

  • Vulcan Materials announced it has reached a definitive agreement with SPO Partners to acquire its aggregates business, Aggregates USA LLC for $900M in cash.
    • The acquisition complements and expands Vulcan's service offerings in Georgia with three granite quarries – two of which have rail capabilities extending the company's reach into important markets – along with 16 rail distribution yards in Georgia, South Carolina and Florida.
    • In addition, the acquisition includes 12 limestone quarries in eastern Tennessee and southwest Virginia.
  • Vulcan expects the transaction to be accretive to the company's EPS in the first year following the close.
  • Vulcan may divest several quarries in Tennessee to a third party in order to expedite the regulatory approval process.

(FLS) Flowserve COO Tom Pajonas to retire; effective 31-Dec -- 8-K ($49.00)

  • On 24-May-17, Flowserve announced that Tom Pajonas, COO of the company and Interim President of the Industrial Product Division , provided the company with notice of his intention to retire from the company as of 31-Dec-17 . In connection with his planned retirement, Pajonas will immediately transition to the role of President of IPD effective 24-May-17.

(DCIX) Diana Containerships announces time charter contract for the m/v Puelo ($0.39) 

  • The company announced that, through a separate wholly-owned subsidiary, it has entered into a time charter contract with Mitsui O.S.K. Lines, Ltd., for one of its Post-Panamax container vessels, the m/v Puelo.
  • The gross charter rate is $14,600 per day, minus a 1.25% commission paid to third parties, for a period of about 50 days.
  • The charter is expected to commence on 13-Jun-17. The m/v Puelo is currently chartered, as previously announced, to MSC-Mediterranean Shipping Co. S.A., Geneva at a gross charter rate of $6,500 per day, minus a 3.75% commission paid to third parties.
  • This employment is anticipated to generate approximately $730,000 of gross revenue for the scheduled period of the time charter.

(NAO) Nordic American Offshore Chairman Herbjorn Hansson and his son acquire 150K shares at $1.12/share ($1.12)

  • Over the last two weeks, as from Tuesday 9-May, the Hansson family has acquired 2,631,007 NAO shares in aggregate at an average price of $1.15 per share.
  • In addition to the holdings of the past, following yesterday's transaction, the Hansson family holds shares equivalent to 8.0% of NAO.

(SBLK) Star Bulk Carriers reports Q1 adjusted EBITDA $18.1M vs FactSet $15.8M ($8.24)

  • Reports Q1:
    • Adj EPS ($0.21) vs year-ago ($0.87)
    • Revenue $64.9M vs FactSet $51.8M
    • Daily TCE $8,176 vs $8,202 seq and year-ago $4,331
    • Fleet utilization 99.2% vs 98.0% seq and year-ago 93.8%

(CMRE) Costamare Inc. to offer 12.5M shares through Morgan Stanley, Wells Fargo, J.P. Morgan, Citigroup and Stifel ($7.76) 

  • Members of the Konstantakopoulos family, who in the aggregate own a majority of the common stock of the company, have indicated their intention to purchase approximately $10M of shares in the offering.
  • The company plans to use the net proceeds of the offering for capital expenditures, including vessel acquisitions, and for other general corporate purposes, which may include repayments of indebtedness.

Upgrades/ Downgrades

(LODE) Comstock Mining expects at least one transaction to occur during Q2 ($0.17)

  • Comstock reported it has significantly advanced two strategic venture discussions this week and anticipates that at least one transaction will occur during Q2.
  • Additionally, the company advanced metallurgical column tests from the Dayton Resource Area, for the purpose of assessing optimum metallurgical feasibility for the Dayton mineralized material.
  • The company has established four, full metallurgical column tests, two cyanide and two non-cyanide, running parallel, that support and advances the feasibility study for establishing proven and probable reserves at the Dayton Mine. The samples were crushed, agglomerated and loaded into four ten-foot columns for leach pad simulation. These simulations are entering their third week of testing
  • The company believes the three primary value drivers for the company’s valuation are the advancements of its Comstock properties toward feasibility, including the Dayton Mine, Joint Ventures that expand or accelerate these mine developments toward feasibility and the completion of the new USA Parkway and its roundabout connection into U.S. 50, both scheduled for completion this year.

(JELD) ELD-WEN Holding announces 14M share offering for holder Onex Partners priced at $30.75 per share ($31.21)

  • Through Barclays, Citi, Credit Suisse, JPMorgan, Deutsche Bank, RBC Capital, BofA Merrill Lynch, Goldman Sachs and Wells Fargo.

(WMS) Advanced Drainage Systems reports Q4 non-GAAP EPS ($0.22) vs FactSet $0.03 ($21.60) 

  • Reports Q4:
    • Revenue $244.2M vs FactSet $228.8M -- 2 estimates
    • Adjusted EBITDA $12.6M vs year-ago $21.6M
  • FY Guidance (Mar 2018):
    • Revenue $1.275-1.325B vs FactSet $1.31B
    • Adjusted EBITDA $200-220M vs FactSet $209.2M
  • Dividend:
    • Increases quarterly dividend to $0.07 from $0.06
    • Payable 15-Jun, of record 5-Jun
  • Management comments:
    • “As we enter fiscal 2018, we expect our strong performance in our core construction markets to continue, aided by improving sales in international coupled with a slower decline in Ag compared to the prior year.
    • "In addition, we will look to accelerate our growth through innovation, such as our recently launched HPXR 75 product line, as well as bolt-on acquisitions that complement our product suite and geographic footprint.
    • "Lastly, we are committed to improving our longer-term margin profile through performance improvement initiatives focused on operational and customer excellence.
    • "Overall, we feel very good about our position in the markets we serve and our ability to continue driving above-market growth and operating leverage over time.”

(PWR) Quanta Services board authorizes $300M repurchase program, effective through 30-Jun 2020 ($31.28)

 

(VMC) Vulcan announces agreement to acquire Aggregates USA LLC for $900M cash ($125.12) 

  • Vulcan Materials announced it has reached a definitive agreement with SPO Partners to acquire its aggregates business, Aggregates USA LLC for $900M in cash.
    • The acquisition complements and expands Vulcan's service offerings in Georgia with three granite quarries – two of which have rail capabilities extending the company's reach into important markets – along with 16 rail distribution yards in Georgia, South Carolina and Florida.
    • In addition, the acquisition includes 12 limestone quarries in eastern Tennessee and southwest Virginia.
  • Vulcan expects the transaction to be accretive to the company's EPS in the first year following the close.
  • Vulcan may divest several quarries in Tennessee to a third party in order to expedite the regulatory approval process.

(FLS) Flowserve COO Tom Pajonas to retire; effective 31-Dec -- 8-K ($49.00)

  • On 24-May-17, Flowserve announced that Tom Pajonas, COO of the company and Interim President of the Industrial Product Division , provided the company with notice of his intention to retire from the company as of 31-Dec-17 . In connection with his planned retirement, Pajonas will immediately transition to the role of President of IPD effective 24-May-17.

(DCIX) Diana Containerships announces time charter contract for the m/v Puelo ($0.39) 

  • The company announced that, through a separate wholly-owned subsidiary, it has entered into a time charter contract with Mitsui O.S.K. Lines, Ltd., for one of its Post-Panamax container vessels, the m/v Puelo.
  • The gross charter rate is $14,600 per day, minus a 1.25% commission paid to third parties, for a period of about 50 days.
  • The charter is expected to commence on 13-Jun-17. The m/v Puelo is currently chartered, as previously announced, to MSC-Mediterranean Shipping Co. S.A., Geneva at a gross charter rate of $6,500 per day, minus a 3.75% commission paid to third parties.
  • This employment is anticipated to generate approximately $730,000 of gross revenue for the scheduled period of the time charter.

(NAO) Nordic American Offshore Chairman Herbjorn Hansson and his son acquire 150K shares at $1.12/share ($1.12)

  • Over the last two weeks, as from Tuesday 9-May, the Hansson family has acquired 2,631,007 NAO shares in aggregate at an average price of $1.15 per share.
  • In addition to the holdings of the past, following yesterday's transaction, the Hansson family holds shares equivalent to 8.0% of NAO.

(SBLK) Star Bulk Carriers reports Q1 adjusted EBITDA $18.1M vs FactSet $15.8M ($8.24)

  • Reports Q1:
    • Adj EPS ($0.21) vs year-ago ($0.87)
    • Revenue $64.9M vs FactSet $51.8M
    • Daily TCE $8,176 vs $8,202 seq and year-ago $4,331
    • Fleet utilization 99.2% vs 98.0% seq and year-ago 93.8%

(CMRE) Costamare Inc. to offer 12.5M shares through Morgan Stanley, Wells Fargo, J.P. Morgan, Citigroup and Stifel ($7.76) 

  • Members of the Konstantakopoulos family, who in the aggregate own a majority of the common stock of the company, have indicated their intention to purchase approximately $10M of shares in the offering.
  • The company plans to use the net proceeds of the offering for capital expenditures, including vessel acquisitions, and for other general corporate purposes, which may include repayments of indebtedness.
Morning Summary | TMT | Energy  | Healthcare  | Consumer  | Financial  | Industrial  | Global Trading Summary

Global Trading Summary

Chris Baggio, Ralph Mak, Mark Huttmann (203) 861-7650 | 5.25.2017

News

Asia

Last

Actual

%change

Mtd

Ytd

Nikkei 225

19,813.13

70.15

0.36%

3.21%

3.66%

Shanghai

3,107.83

43.76

1.43%

-1.48%

0.14%

Hang Seng

25,630.78

202.28

0.80%

4.13%

16.50%

Australia

5,789.63

20.65

0.36%

-2.27%

2.19%

Europe

Last

Actual

%change

Mtd

Ytd

EuroStoxx 50

3,587.84

1.18

0.03%

0.79%

9.03%

Germany

12,626.20

(16.63)

-0.13%

1.51%

9.97%

UK

7,514.85

(0.08)

0.00%

4.32%

5.21%

France

5,339.82

(1.55)

-0.03%

1.38%

9.82%

 

Market Holidays: Austria, Denmark, Finland, Indonesia, Norway, Sweden, Switzerland

 

Market commentary:

Asian markets rallied following gains in the US and ahead of the OPEC meeting. China (+1.4%), Taiwan (+1.1%), Hong Kong (+0.8%), Korea (+0.6%), Japan (+0.4%) and Australia (+0.4%) led to the upside. Regional volumes were +10% from yesterday, but remained quiet.

Financials, technology, telcos, materials and industrials led markets higher. Retailers and healthcare names were mostly lower while energy, autos and foods were mixed.

 

European markets are mixed in extremely quiet trading with several markets offline for holidays, among them Austria, Denmark, Finland, Norway, Sweden and Switzerland. Volumes elsewhere are running at ~65% of the 20 day average, -20% from yesterday.

UK Q1 GDP +0.2% QoQ vs. estimates +0.3%. UK April Housing Loans 40,750 vs. 40,800. OPEC said to extend production cuts for 9 months, as expected. EUR -5 bps, GBP-15 bps.

Consumer products, transports, industrials, apparel and healthcare names are higher.

Steel, miners, energy, food retailers and autos are lower.

 

Japan’s NKY index finished higher by 0.4% as shares continued to tracked overnight cues on Wall St. while the yen weakened, paring overnight strength.  Telecommunications rallied the most as shares of Softbank Group climbed 3.8% while rival KDDI Corp added 0.9% despite a downgrade  @ CITI.  Utilities extended gains with shares of J-Power higher by 4.1%, advancing for a 4th consecutive session while peers Chubu Electric and Kyushu Electric Power gained 1.6% to 1.9%. Technology was most higher, led by software cos including Konami +3.5% following an upgrade @ JEFF while Square Enix climbed 3.2% after announcing plans to buy back as much as 10.2b yen of shares from the co’s founder. Chipmaker Tokyo Electron and Japan Materials rallied 1.5% and 2% respectively while Nidec Corp added 1.7%.  Exporters were mixed as major automaker Honda Motor pared yesterday’s gains, slipping 1.3% while Mitsubishi and Subaru Corp rose 0.1% to 0.3%. Among the laggards were materials as miners and chemical makers weakened.  Shares of Mitsubishi Materials and Sumitomo Metal Mining fell 1.3% to 1.4% while chemical makers including Sumitomo Chem, Shin Etsu Chem and Mitsubishi Chem slipped 0.8% to 1%. Energy producers also sank as shares of Japan Petro and Inpex Corp lost 0.8% to 1%. Market turnover was weaker by 20% vs the 20 day avg., off 6% from yesterday.

Stocks in Hong Kong were higher for a 5th day, shrugging off a Moody’s downgrade as the region rallied following gains in the US and ahead of the OPEC meeting. The Hang Seng Index gained 0.8%, led higher by technology, real estate, financials energy and telcos as all groups finished in positive territory. Technology stocks were the best performers with Lenovo Group (992 HK, +3.7%) leading the charge after beating estimates. Tencent Holdings (700, +1.3%) was also higher. Real estate names were also strong across the board after a couple of local brokers gave positive outlooks for smaller Chinese cities. China Resources Land (1109, +3.7%), China Overseas Land (688, +2.9%) and Link REIT (823, +1.6%) led the gains. Banks were also strong, led by China Construction Bank (939, +1.9%), BOC Hong Kong Holdings (2388, +1.3%) and ICBC (1398, +1%). Market volumes were right around the 20 day average, +13% from yesterday.

Australia’s ASX index rose 0.4% as resources shares paced gains on the gauge after iron ore and crude oil prices recovered overnight losses.  Energy producers Woodside Petro, Origin Energy and Beach Energy climbed 1.5% to 1.9% ahead of an OPEC meeting later today. Mining heavyweights including BHP Billiton, Rio Tinto and Fortescue Metals rose more than 1% apiece as iron ore and steel futures recovered from yesterday’s drop following China’s credit ratings downgrade.  Commonwealth Bank of Australia was 0.3% higher, Westpac Banking rose 0.2% and Australia & New Zealand Banking was 1.3% stronger, although National Australia Bank dropped 0.5%. Shares of Aristocrat Leisure climbed 4% after the slot-machine maker reported better-than-expected first-half earnings while electronics retailer JB Hi-Fi and Super Retail Group tumbled 1.6% and 6%, respectively amid a downgrade @ JPM. Shares of department store operator Myer Holding slumped 4.4%.   Industrials extended yesterday’s advanced as share of Transurban Group and Brambles Ltd rallied 1% to 1.6% while Boral Ltd gained 0.4%.  Market participation was light, dropping 10% vs the 20 day avg.

So Korea’s Kospi index rallied 1.1%, extending gains for a 5th session as stocks reached another record following the BoK move to keep interest rates at a record low 1.25% as expected. Technology, industrials, financials and materials were among the best performing groups while healthcare related shares weakened. Shares of heavyweight chipmaker Samsung Electronics jumped 1.8% after the co. announced plans to split its foundry business into a new unit while announcing new production methods to improve its chips. Shares of Samsung affiliate Samsung SDS gained 1.3% while SK Hynix ended flat. Shares of GS Engineering rose 5.7%, pacing the rally among peers after signing residential construction contracts worth 728b won. Rival shares of Samsung Engineering and Daewoo E&C rallied 2.4% to 3.6% and while Doosan Infracore added 1.8% following an upgrade to Buy @ HSBC.  Financials were mostly higher with banks including KB Financial, Industrial Bank of Korea and Woori Bank rising 1% to 1.6% while shares of major insurer Samsung Fire & Marine jumped 2.7%.  Market turnover rose 8% vs the 20 day avg.

Taiwan’s Taiex index gained 0.6% as stocks extended gains following the better overnight performance on Wall St.  Among the best performing sectors leading the metric were consumer staples, materials and technology.  Tech heavyweight TSMC and rival UMC added 0.4% to 0.7% while specialty chipmaker MediaTek surged 5.5%. Apple suppliers saw a mixed picture as shares of Hon Hai Precision and Foxconn Tech jumped nearly 1% while Largan Precision and Catcher Tech fell 0.9% to 1.1%.  Chemical makers led the rally in materials as Formosa Chemical and Formosa Plastics added 1.1% and 1.4%, respectively while steel makers China Steel Corp and Tung Ho Steel rose 0.4% - 0.6%. Consumer staples rallied as shares of food maker Uni-President Enterprises and Great Wall Enterprises advanced 3.3% to 3.7% while auto retailer Hotai Motor rose 1.2%. Shares of major shipping co. Yang Ming Marine surged as much as 10% intraday after the co. said it plans to raise more capital and expects to successfully increase freight rates for U.S., Europe routes in June.  Financials also improved with CTBC Financial adding 1.8% while peers Fubon Financial and Yuanta Financial gained 0.3% and 0.8%, respectively. Market participation rose a modest 5% vs the 20 day avg.

 

 

 


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