NEW YORK, NY / ACCESSWIRE / December 12, 2018 / Target and Urban Outfitters both closed in the red on Tuesday. Traders showed their concern over Urban Outfitters’ fourth quarter results so far and Target agreed to pay $3 million to resolve a Massachusetts Medicaid claim.
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Urban Outfitters, Inc.
Target Corporation shares closed down 2.25% on about 5.7 million shares traded on Tuesday. The big box retailer saw its shares drop as traders learned the company has agreed to pay $3 million to resolve allegations that it violated rules of Massachusetts' Medicaid program. According to authorities, Target pharmacies knowingly and routinely enrolled MassHealth beneficiaries in the auto-refill program, then billed MassHealth. This went on until Target sold its pharmacy business to CVS Health near the end of 2015. In other news, last minute shoppers were thrilled to learn that Target announced that for the holiday shopping season, it would keep its doors open up until 10 p.m. on Christmas Eve, as part of its plan to bring in more traffic during the busy holiday season.
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Urban Outfitters, Inc. shares closed down 6.71% on about 5.3 million shares traded yesterday. Trading volume was more than double compared to usual after traders learned of a concerning comment in the company's quarterly filing with the SEC. The specialty retailer said that its comparable retail segment net sales were up mid-single-digit percentages so far in the fiscal fourth quarter. This is down from the 8.7% pace of revenue growth for the fiscal third quarter. While the Company released its 3rd quarter earnings on Nov 19, the 10-Q was filed on 10th of December. CEO Richard A. Hayne said during the company's third quarter earnings call, "In Q3, we produced yet another record quarter. URBN brand teams delivered an 8% Retail segment comp on a plus 1% last year, and earnings jumped 72% over the prior year period. Sales, earnings and earnings per share all set new URBN third quarter records. As was true in the first half, strong demand for apparel and accessories drove much of these record-setting results. Both Retail segment channels registered positive comps in both North America and Europe, and digital comps continue to grow at a double-digit pace at all 3 brands." Shares dropped to their lowest level in 9 months.
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