Housing Boom Lifts Home Depot Sales, TJX Offers Cautious Holiday Views

Mukesh Buch
15 Nov, 2016
New York City

Dicks Sporting lifted earnings forecast. Estee Lauder agreed to acquire Too Faced, the feminine makeup brand for $1.45 billion. Home Depot net soared 18% and reaffirmed sales forecast. Reynolds American rejected $47 billion takeover offer from BAT.

[R]2:10 PM New York – Dicks Sporting lifted earnings forecast. Estee Lauder agreed to acquire Too Faced, the feminine makeup brand for $1.45 billion. Home Depot net soared 18% and reaffirmed sales forecast. Reynolds American rejected $47 billion takeover offer from BAT.[/R]

Tollbooth Index advanced 106.32 or 1.6% to 10,848.54.

Earnings Review

Dicks Sporting Goods Inc ((DKS)) plunged 6.9% or $4.09 to $56.80 after the sporting goods retailer said net sales in the third-quarter ending on October 29 soared 10.2% from a year ago to $1.8 billion.

Same store sales across all brands in the quarter advanced 5.2%. Same store sales in Dick''s Sporting Goods surged 5.5% while Golf Galaxy decreased 3.3%.

Net income in the quarter jumped 3.6% to $48.9 million or 44 cents per diluted share compared to the $47.2 million or 41 cents per share from the same quarter last year.

The sporting goods retailer lifted annual diluted earnings per share forecast for the year in the range of $2.91 to 3.03 and same store sales to increase approx 3% to 4% compared to the decrease of 0.2% in fiscal 2015.

Estee Lauder Companies Inc ((EL)) increased 1.5% or $1.19 to $78.79 after the skin care, fragrance and hair care products maker agreed to acquire Too Faced, the makeup brand for about $1.45 billion.

The transaction is expected to close in December.

Home Depot Inc ((HD)) slumped 1.8% or $2.31 to $125.41 after the home improvement retailer reported sales in the third-quarter ending on October 30 rose 6.1% from a year ago to $23.2 billion.

Comparable store sales in the quarter advanced 5.5% and sales in the U.S. based stores jumped 5.9%.

Net income in the quarter soared 17.6% to $2 billion or $1.60 per diluted share compared to the $1.7 billion or $1.60 per share from the same quarter last year.

The retailer reaffirmed sales forecasted in fiscal 2016 to jump 6.3% and comparable sales to increase 4.9% and also lifted diluted earnings per share estimate to grow approx 15.9% from fiscal 2015 to $6.33.

Reynolds American, Inc ((RAI)) rose 26 cents to $53.31 after the cigarettes and tobacco products maker rejected $47 billion takeover offer from the U.K.-based British American Tobacco.

British American Tobacco controlled 42% of Reynolds American and in October offered to buy the remaining stake of 58% that it doesn''t already own with premium of 20%.

Teva Pharmaceutical Industries Ltd ((TEVA)) declined 4.9% or $2.02 to $38.98 after Israel-based generic drugs maker stated revenues in the third-quarter ending in September jumped 15% from a year ago to $5.6 billion.

Net income in the quarter surged three-fold to $412 million or 35 cents per diluted share compared to the $103 million or 12 cents per share from the same quarter last year.

Teva Pharma forecasted revenues in the year between $21.6 billion and $21.9 billion and in the fourth-quarter in the range of $6.2 billion and $6.5 billion.

The TJX Companies Inc ((TJX)) dropped 1.3% or 97 cents to $73.25 after the off-price apparel and home fashions retailer reported sales in the third-quarter ending on October 29 advanced 7% from a year ago to $8.3 billion.

Comparable store sales in the quarter jumped 5% and in the U.S. stores jumped 5.9%.

Net income in the quarter declined 6.4% to $549.8 million or 83 cents per diluted share compared to the $587.3 million or 86 cents per share from the same quarter last year.

TJX lowered diluted earnings per share forecast in the fourth-quarter in the range of 96 cents to 98 cents from 99 cents reported in a year ago period.

In the year, the off-price retailer estimate diluted earnings per share between $3.39 and $3.41 compared to the prior guidance of $3.39 to $3.43.