Stocks reversed course giving back some gains posted yesterday. Markets moved lower on worries that the economy is improving to the point where the Fed will cut back its stimulus program. There were no major economic reports released today. Tomorrow, traders will likely be turning to the Labor Department's report on weekly jobless claims. The Commerce Department will also be releasing a second estimate of first quarter GDP.
Shares of Smithfield Foods (SFD) skyrocketed nearly 30% on news of a takeover. China's Shuanghui Group, also known as Shineway, is buying the company for $4.7 billion dollars or $34 a share. That represents about a 30% premium over Smithfield's closing price yesterday and immediately moved the share price above $32. Prior to today, Smithfield shares had already gained 20% year-to-date. Shineway, like Smithfield, is a meat processing company.
Fresh Market (TFM) proved ripe for the picking today with shares climbing over 8%. The smaller rival of Whole Foods Market (WFM) missed estimates on revenues which came in at $366.6 million. However, they rose nearly 13% over last year. The company also beat by 2-cents on earnings per share and backed its earlier outlook.
Michael Kors (KORS) rose over 3% after easily beating quarterly earnings estimates. The company made 50-cents a share when consensus was for 39-cents. Revenue approached $600 million and was more than 10% above estimates. Compare that to the same period a year ago when earnings were 22-cents a share on revenues of $380 million. The company now operates more than 300 stores, plus its merchandise is placed in many other stores. The stock is up over 150% since it went public back in December of 2011.
Chico's (CHS) on the other hand is looking worn out. Shares fell 7% after the company posted quarterly earnings of 32-cents a share on $670 million in revenue when estimates were for 36-cents a share on $708 million. Still, sales are up substantially over last year as the chain has added 114 new stores and increased its square footage by 9%. The company says sales for the quarter were hampered in part by cool weather.
Sticking with clothing, teen retailer Wet Seal (WTSL) climbed 8% today as traders reacted to the company's quarterly earnings which were released after yesterday's closing bell. The company just squeaked by estimates on revenue posting $140.4 million in sales. But it logged earnings of 3-cents a share when consensus was for just a penny. Wet Seal says sales are down at its namesake stores but are rising at its Arden B. chain. Shares are up 60% this year and 40% in just the past month.