Commerce Secretary Wilbur Ross took a shot at Campbell Soup (CPB -11.9%) by claiming that the company is blaming tariffs for its lack of profits. While Campbell didn't point to tariffs as the reason behind its $393M net loss in Q1 as indicated by Ross, the subject did come up on the post-earnings conference call.
Here's exactly what Campbell CFO Anthony Disilvestreo said on the call (transcript): "At this stage, given what we know about accelerating cost inflation, in part due to the anticipated impact of import tariffs and the continuing headwind on transportation and logistics cost, we expect our margins will be down in fiscal 2019."
Nordstrom (NYSE:JWN) is down 10.01% after the company's weak performance in the off-price channel offset momentum in the digital business.
While some analysts are pointing to the lower-than-anticipated gross margin rate recorded by Nordstrom as a warning sign for upcoming quarters, Atlantic Equities analyst Daniela Nedialkova has a different takeaway.
"We see a strengthening full-line vs off-price trend as a positive indicator — both for overall consumer health and demand for softlines and for JWN itself. FY18 should be an inflection point for margins at JWN, and full-line is a big part of the inflection story," she writes.
Shares of Nordstrom are at their lowest level since December.
Though the Supreme Court this week paved the way for states to allow betting on individual sporting events, as things stand now, you can't use a credit card to make that bet.
The largest U.S. issuers--such as JP Morgan (NYSE:JPM), Citigroup (NYSE:C), and American Express (NYSE:AXP)--don't allow credit card use for sports gambling.
Banks will have to revise policies, decisioning tools, and merchant classification codes to allow sports gambling using credit cards, Bloomberg reports.
Processors, including Worldpay Inc., and payment networks Visa (NYSE:V) and Mastercard (NYSE:MA), though, are educating banks on how to change systems to authorize gambling transactions and ways to limit losses when borrowers can't repay the bets gone bad.
Texas Roadhouse <<(TXRH>> announced that Vice President of Finance and Investor Relations, Tonya Robinson, has been promoted to Chief Financial Officer.
“Tonya brings unmatched experience, knowledge and understanding of Texas Roadhouse and the investment community. Tonya has and will continue to have a big impact on our company,” said Scott Colosi, President of Texas Roadhouse.
Blackstone Group (BX -0.4%) is selling off the last of its position in Hilton Worldwide (HLT +0.2%) with a deal to unload 15.8M shares. The Blackstone stake to be sold is 5.79% of all the Hilton shares outstanding.
The long association between Blackstone and Hilton includes a go-private deal in 2007 and IPO in 2013.
Shares of Hilton, which are up 31% over the last 52 weeks, will provide Blackstone with a significant profit.
Cellectis (NASDAQ:CLLS) carve-out Calyxt (NASDAQ:CLXT) prices its public offering of 3.6M (from 3.05M) shares of common stock at $15 per share. Underwriters over-allotment is an additional 457.5K shares. Closing date is May 22.
The Board of Directors of Patrick Industries (NASDAQ:PATK) approved an increase in the amount of the Company's common stock that may be acquired over the next 24 months under the Company's current stock repurchase program to $50M, including the amount remaining under the previous authorization.
"The increase in our stock repurchase authorization reflects the confidence that our Board of Directors and management team have in Patrick's outlook and market conditions, and is consistent with our capital allocation strategy and our commitment to driving shareholder value," said Todd M. Cleveland, Chief Executive Officer.
Post Holdings (NYSE:POST) announces that it confidentially submitted to the SEC an amended draft registration statement for the proposed IPO of its its private brands business.
The number of shares of stock and the price range for the proposed offering have not yet been determined.
The Post plan is to combine its private brands businesses, which produce nut butter, healthy snacks and pasta, and explore a range of strategic alternatives for the combined private brands business including the IPO option.
Imperial Capital downgrades Planet Fitness (NYSE:PLNT) to an In-line rating after having the gym operator set at Outperform. The reset is a valuation call after shares of Planet Fitness have run up 97% over the last 52 weeks.
The investment firm assigns a price target of $40 to Planet Fitness.
Campbell Soup (NYSE:CPB) reports net sales increased 15% in Q3, driven by a 14-point benefit from the recent acquisitions of Snyder’s-Lance and Pacific Foods and a 1-point favorable impact from currency translation.
Total volume and mix +1% for the period.
Revenue by segments: Americas simple meals and beverages: $1.01B (+5%); Global biscuits and snacks: $862M (+35%); Campbell fresh: $251M (+1%).
Adjusted gross margin rate squeezed 390 bps to 32%, primarily driven by cost inflation and higher supply chain costs, as well as the dilutive impact of recent acquisitions and higher promotional spending.
FY2018 Guidance: Net sales: +10% to +11%; Adjusted EBIT: -8% to -6%; Adjusted EPS: $2.85 to $2.90 (-6% to -5%).
Old Dominion Freight Line (NASDAQ:ODFL) announces that its board has approved a new $250M stock repurchase authorization.
The new repurchase program will commence upon the expiration of the previously authorized two-year repurchase program announced on May 23, 2016.
"Old Dominion’s strong balance sheet and cash flow have enabled us to return value to shareholders through share repurchases and our quarterly cash dividend, while at the same time continuing to strategically invest in the long-term growth of our business," says CEO Greg Gantt.
Park Hotels & Resorts (NYSE:PK) says it closed on the sale of the 601-room Hilton Berlin located in Berlin, Germany.
The gross proceeds from the sale is €297M million and Park’s pro rata share of gross proceeds is ~$140M.
The sale was executed at price ~20X the hotel’s 2017 EBITDA.
The sale of the Hotel marks the 13th hotel that Park has sold in 2018.
CEO update: "We are excited to announce the execution of another non-core asset sale at extremely favorable pricing. We have been laser-focused on reshaping our portfolio and maximizing value for our stockholders, and we are pleased that this sale helps to reduce our exposure to international markets, while further simplifying the ownership structure of our assets."
Shenzhen E-Sun Sky Network Technology, a subsidiary of a consolidated affiliated entity of 500.com Limited (WBAI) and the Hunan Provincial Sports Bureau Sports Lottery Administration Center entered into a cooperation agreement.
As per the agreement, Hunan Sports Lottery Center shall support E-Sun Sky to assist in developing physical sales channels in Hunan Province, in order to enhance the convenience of sports lottery ticket purchases, enlarge customer base and optimize user experience for lottery purchasers.
Where Food Comes From <<OTCQB:WFCF>> acquired privately held software maker Sow Organic, Inc., for $0.9M including $0.45M in cash and $0.45M in WFCF common stock.
The two companies will work together to further develop the organic business opportunity and collaborate on a broader rollout of the solution to other certification markets.
Jeff Dlott, CEO of SureHarvest, said, “We welcome Sow Organic to the team. Our companies share tremendous synergies and a common vision for using technology to improve efficiencies for our customers. We look forward to a smooth integration process and to collaborating on strategies to accelerate development of the organic market and introduce Sow’s SaaS solution to the broader verification and certification market.”
Tesla (TSLA -0.2%) secures a three-year lithium supply agreement with Kidman Resources when the Australian miner begins producing battery-grade materials - likely not before 2021 - highlighting the scramble for raw materials needed to meet the anticipated demand for electric vehicles.
The agreement is for an initial three-year term on a “fixed-price take-or-pay basis” from the first product delivery, and features two three-year term options.
The deal comes just days after Kidman chose a site to develop a lithium processing plant in Western Australia with joint venture partner Sociedad Quimica y Minera de Chile (NYSE:SQM).
Chegg (CHGG +1.4%) acquires WriteLab for ~$15M, in an all cash transaction. An additional payment of $5M may be paid to key employees over the next three years, in cash or stock at Chegg's sole discretion, contingent upon the continued employment of such key employees.
WriteLab is an AI-enhanced writing platform that teaches students grammar, sentence structure, writing style, and offers instant feedback to help students revise, edit, and improve their written work.
As a result of this acquisition, Chegg does not expect any material effect on operations, Q2 guidance, or full year 2018 guidance issued on April 26, 2018.
Escalade <<ESCA>> today announced it has sold it's 50% equity share of STIGA Sports Group AB to a Swedish private investor
The wholly owned subsidiary of Escalade Sports entered into a long-term licensing agreement for the STIGA brand on table tennis tables and accessories in North America.
Dave Fetherman, President and Chief Executive Officer of Escalade said, "Our journey with STIGA began twenty-three years ago, and in that time, we have helped our retail partners in sporting goods and other channels, grow their table tennis business by developing and delivering a comprehensive range of table tennis products. STIGA Sports AB has been an excellent partner for us and we look forward to continuing our work together to deliver the most innovative products for consumers under the STIGA brand."
Hasbro (HAS +0.5%) announces that its board authorized a new buyback allowance of $500M.
The company says at the end of Q1 it had $139.2M available in the current share repurchase authorization.
CFO update: "Hasbro is committed to strategically investing in our business for long-term profitable growth and returning excess cash to our shareholders. The Board’s additional $500 million stock authorization reaffirms this commitment and demonstrates confidence in the future value of Hasbro’s strategy. Hasbro is executing from a healthy financial position, with an operating cash flow target of $600-700 million this year and a solid balance sheet."
Wolfe Research updates on Target (TGT +0.8%) after a round of channel checks in Houston, Atlanta, Washington DC and Philadelphia
Analyst Scott Mushkin: "We have seen a marked improvement in store conditions, including in-stock. We believe the change is driven by an adjustment in the way stores are run, with managers now assigned to key areas such as food and apparel. These departments also have dedicated staff to make sure the area is well maintained and stocked. Our research suggests the change is having a dramatic impact. Add to this the company’s efforts to remodel and emphasize signature categories such as beer and wine."
Wolfe lifts Target to an Outperform rating from Peer Perform based off the positive momentum.
Goldman Sachs estimates that Tesla (TSLA +0.6%) will need $10B in fresh capital by 2020 to fund operations.
"We believe this level of capital transactions may be funded through multiple avenues, including new bond issuance, convertible notes, and equity," says GS analyst David Tamberrino.
"We see several options available to the company to refinance maturing debt and raise incremental funds, which should allow Tesla to fund its growth targets," he adds.
Tamberrino is firmly in the Tesla bear camp, with a Sell rating and price target of $195 on the EV automaker, although he was not one of the analysts shut down by Elon Musk during Tesla's Q1 earnings call. He was three for three in asking questions and getting answers (transcript).
BJ's Wholesale Club (BJ) files for an IPO on the New York Stock Exchange.
The retailer was taken private in PE buyout by Leonard Green and CVC Capital Partners in 2011.
Last year, BJ's reported revenue of $12.8B and adjusted EBITDA of $534M.
The company says recent changes have "delivered results rapidly, evidenced by positive and accelerating comparable club sales over the last two quarters and net income growth of over 109% and Adjusted EBITDA growth of 31% in aggregate over the last two fiscal years."
Investors and analysts are seeing a match made in grocery heaven after Kroger (NYSE:KR) announced a partnership with e-commerce specialist Ocado Group (OTCPK:OCDGF, OTC:OCDDY).
RBC Capital says the Kroger-Ocado partnership "dwarfs" the e-commerce efforts of other U.S. brick-and-mortar retailers due to the large fulfillment and distribution capabilities.
The deal is also seen as a nice countermeasure by Kroger to Amazon's (AMZN -0.1%) grocery ambitions.
Today's development has significance for grocery chains Supervalu (SVU +1.2%) and Sprouts Farmers Market (SFM +0.9%), as well as Target (TGT +0.9%).
Shares of Kroger are up 3.36% in morning trading, while Ocado is up 48% in London. Bloomberg reports that Ocado is now a candidate to be included in the U.K.'s benchmark FTSE 100 index after the moonshot.
Diana Containerships Inc. (DCIX N/A) through a separate wholly-owned subsidiary, signed a Memorandum of Agreement to sell to an unaffiliated third party the 2009-built vessel “Hamburg” for $21M before commissions, with delivery latest by July 31.
Net proceeds from the sale of the vessel are expected to be used by the Company to prepay part of the existing indebtedness.
Upon completion of the sale, Diana Containerships Inc.’s fleet will consist of 5 container vessels (3 Post-Panamax and 2 Panamax).
Restaurant same-store sales were up 1.5% in April, according to data from TDn2K. The mark is the highest since September of 2015 and follows the 0.8% increase in March..
Comparable traffic was down 1.4% during the month, a deceleration from the 2.1% drop in the prior month. Guest spending has been up about 3% in March and April to offset the drop in restaurant guests.
"In April, to-go, delivery, catering and banquet sales each outperformed sales growth for dine-in sales. Across industry segments, the percentage of total restaurant sales represented by these off-premise food categories has been growing. Consumers behavior is shifting and 'on-the-go' has become an extremely important component of restaurant demand," reports TDn2K.
Despite the positive signs for the industry in April, TDn2K issues some caution. "Stronger economic conditions and high consumer confidence are certainly factors. However, this performance has to be considered against last year’s soft sales. A longer view suggests there are still significant challenges for the industry," warns the research firm.
Southwest Airlines (NYSE:LUV) says it has completed a round of engine inspections across its fleet.
CEO Gary Kelly confirms that small number of engine fan blades were sent back to the manufacturer for more testing out of an abundance of caution. The fan blades were not sent back due to metal fatigue.
Shares of Southwest are up 0.66% premarket to $53.36. LUV is -19.01% YTD.
Dillard's (NYSE:DDS) reports a 2% increase in total merchandise sales and comparable sales during Q1.
Strength in home and furniture, ladies' accessories and lingerie and juniors' and children's apparel helped to offset some weakness in men's apparel and shoes.
The company says gross margin from retail operations fell 66 bps, compared to a year ago. SG&A expenses were down 10 bps to 27.9% of sales.
"Our positive sales momentum continued into the first quarter. We believe this indicates our customer is more comfortable spending in this economic environment, and we hope the positive trend continues," says Dillard's CEO William Dillard.