Walgreens Wins Revised Approval for Rite Aid, AutoZone Rally Fizzles

Mukesh Buch
19 Sep, 2017
New York City

AutoZone reports sales and earnings growth but the early rally in stock fizzles. Apogee reaffirmed fiscal outlook. Catalent agreed to buy privately held Cook Pharmica for $950 million. Neogen net and revenues surged. Steelcase net jumped. Walgreens received regulatory clearance to acquire Rite Aid.

[R]1:45 PM New York – AutoZone reports sales and earnings growth but the early rally in stock fizzles. Apogee reaffirmed fiscal outlook. Catalent agreed to buy privately held Cook Pharmica for $950 million. Neogen net and revenues surged. Steelcase net jumped. Walgreens received regulatory clearance to acquire Rite Aid.[/R]

Tollbooth Index fell 9.58 to 12,496.75.

Earnings Review

AutoZone, Inc ((AZO)) plunged 5% or $28.40 to $535 after the automobile parts and accessories retailer reported revenues in the fourth-quarter ending on August 26 rose 3.3% from a year ago to $3.5 billion.

Net income in the quarter increased 1.7% to $433.9 million or $15.27 per diluted share from $426.8 million or $14.30 in the same quarter last year.

The retailer said domestic same store sales increased 1%.

“We are well positioned to grow sales further in 2018,"" said chairman, president and chief executive officer Bill Rhodes.

Apogee Enterprises Inc ((APOG)) fell 19 cents to $44.79 after the construction supplies and fixtures provider said sales in the second-quarter ending on September 2 soared 24% from a year ago to $343.9 million.

Net income in the quarter plunged 22% to $17.4 million or 60 cents per diluted share from $22.4 million or 77 cents in the same quarter last year.

Apogee reaffirmed fiscal 2018 revenue growth between 24% and 26% and diluted earnings per share in the range of $3.05 to $3.25.

Catalent Inc ((CTLT)) dropped 2.3% or 85 cents to $39 after the consumer and animal health products provider agreed to acquire privately held drug substance and drug product maker Cook Pharmica LLC for about $950 million in cash.

The transaction is expected to close in the fourth-quarter of this year.

Neogen Corporation ((NEOG)) slumped 2.3% or $1.70 to $72.37 after the food and animal safety products developer reported revenues in the first-quarter ending in August jumped 14% from a year ago to $95.3 million.

Net income in the quarter soared 21% to $11.9 million or 31 cents per diluted share from $9.9 million or 26 cents in the same quarter last year.

Neogen reported revenue increases in 102 quarters of the past 107 quarters in last 12 years in a row.

Steelcase Inc ((SCS)) soared 4.2% or 60 cents to $14.95 after the furniture and interior architectural products provider stated revenues in the second-quarter ending on August 25 advanced 2% from a year ago to $775.6 million.

Net income in the quarter jumped 5% to $36.9 million from $38.2 million and diluted earnings per share were flat at 31 cents in the same quarter last year.

The office furniture provider estimated fiscal 2018 revenue in the range of $785 million to $810 million and diluted earnings per share between 21 cents to 25 cents.

Walgreens Boots Alliance Inc ((WBA)) declined 2% or $1.65 to $80.96 after the drugs retailer received regulatory clearance to acquire Rite Aid Corp assets including its 1,932 stores along with three distribution centers for about $4.38 billion in cash.

The terms were revised from the June agreement from the price of $5.18 billion for 2,186 stores. The stores acquisition will start from October and is expected to complete in spring 2018.

Rite Aid Corporation stock declined 9.2% to $2.48.