General Mills Falls on Lower Sales, Trimmed Outlook
2 minutes ago
General Mills (GIS) shares dropped over 3% in intraday trading Wednesday after the cereal giant missed sales estimates and cut its outlook as higher prices led consumers to shift to lower-priced brands.
The maker of Cheerios cereal, Blue Buffalo pet food, and other packaged food products reported second-quarter fiscal 2024 revenue dropped 1.6% from a year ago to $5.14 billion, almost a quarter of a billion dollars below forecasts. Earnings per share at $1.25 exceeded expectations.
The company lowered its full-year organic revenue outlook to between flat to down 1%, compared to its earlier guidance of 3% to 4% growth. It anticipates EPS up 4% to 5% versus the previous 4% to 6%.
Shares of General Mills have lost more than one-fifth of their value this year.
-Bill McColl
TradingView
Aon to Acquire Insurance Broker NFP for $13.4 Billion
1 hour ago
Management consultant Aon (AON) said it would buy middle-market insurance firm NFP in a cash and stock deal worth $13.4 billion.
The deal announced Wednesday will be funded by $7 billion of cash and $6.4 billion of Aon stock. Aon said it expects the transaction to deliver more than $2.8 billion in pre-tax gains, net of $400 million in transaction and integration costs.
The deal is expected to close in mid-2024 and have a positive effect on adjusted earnings per share by 2027.
Shares of Aon were down 5.9% at about $295 per share Wednesday afternoon, putting them 1.8% lower year-to-date.
-Kevin George
FedEx Plunges After Its Latest Earnings Report—Here’s Why
1 hr 37 min ago
FedEx (FDX) was the worst-performing stock in the S&P 500 on Wednesday, with shares plunging over 10% after the delivery firm posted worse-than-expected results and cut its guidance on weaker demand.
FedEx reported second-quarter fiscal 2024 earnings per share (EPS) of $3.99, with revenue falling 3% from a year ago to $22.17 billion. Both missed estimates.
The company noted that the revenue drop was the result of “volume declines, lower fuel surcharges, reduced demand surcharges, and a mix shift toward lower-yielding services.”
FedEx warned lower demand would continue to weigh on revenue. The company now anticipates full-year sales to fall by a low-single-digit percentage, down from its previous forecast that revenue would remain unchanged. It was the second consecutive quarter the company reduced its outlook.
-Bill McColl
TradingView
Midday Movers
2 hr 43 min ago
Alphabet (GOOGL): Shares of the tech giant rose about 3% following reports it plans to restructure its ad sales business as clients increasingly rely on artificial intelligence to generate and place ads.
ConocoPhillips (COP): The oil company gained about 2% as oil prices inched up amid disruptions in the Red Sea. More than 10% of global trade passes through the Red Sea on its way to or from the Suez Canal.
FedEx (FDX): Shares fell more than 11% after the delivery company’s quarterly earnings fell short of Wall Street estimates. It also lowered its full-year sales outlook for the second consecutive quarter, citing lower demand.
Aon Plc (AON): Shares of the insurance broker fell more than 5% after it said it would buy middle-market insurance broker NFP for $13.4 billion.
Google Jumps to Fresh 52-Week High Following Report of Ad Business Restructuring
3 hr 41 min ago
Shares of Google-parent Alphabet (GOOGL) gained more than 3% to trade at a one-year high Wednesday following reports of an impending shake-up in its core advertising business.
The Information on Tuesday reported that Sean Downey, who leads Google’s ad business in North and South America, said in a department-wide meeting that the company’s 30,000-person ad sales unit would be reorganized, according to people familiar with the matter. He did not specify whether the reorganization would involve layoffs.
The consolidation comes as Alphabet leans on artificial intelligence to generate and place ads on Google, YouTube, and its other platforms. Alphabet generated $54.5 billion in revenue—or 80% of total revenue—from ad sales in the third quarter.
Generative artificial intelligence can be substantially cheaper than conventional methods for both ad creators and sellers. WPP, the world’s largest advertising firm, struck a deal with Nvidia in May to create an AI-enabled content development engine. “The savings can be 10 to 20 times,” Mark Read, WPP’s chief executive, told Reuters.
Three Big Analyst Calls Today
4 hr 38 min ago
Discover Financial (DFS) shares rose more than 1% after Citigroup upgraded the stock to buy from hold. Analysts cited several catalysts that could boost shares next year, including the reinstatement of share repurchases, the sale of its student loan portfolio, and the likelihood of credit losses peaking next year.
Lowe’s (LOW) shares were downgraded to hold from buy by analysts at Stifel, citing continued softness in the home improvement business. Lowe’s warned of tough times ahead in its quarterly earnings report last month when it missed sales estimates and cut its full-year earnings and sales outlook amid a pullback in consumer spending on big-ticket items. Lowe’s stock fell more than 1% early Wednesday.
Costco (COST) was downgraded to neutral from buy by analysts at Northeast Research despite the company’s better-than-expected earnings report last week. Costco shares closed at a record above $681 on Monday, but were down about 1.5% at $667 Wednesday morning.
A Stock Chart to Watch Today: FedEx
5 hr 9 min ago
Shares in package delivery giant FedEx (FDX) fell nearly 10% at the market open Wednesday after the company trimmed its sales outlook amid weaker customer demand.
In its fiscal second-quarter earnings report released after the closing bell Tuesday, the company said it expects a low single-digit decline in revenue for the full fiscal year, a bigger drop than analysts expected and down from its prior forecast of sales remaining flat on a year-over-year basis. The company said softening macroeconomic conditions will continue to weigh on delivery demand in upcoming quarters but noted that operating income will improve due to recent cost-cutting initiatives.
Source: TradingView.com.
Since bottoming out in the third quarter of 2022, FedEx shares have trended steadily higher apart from a significant retracement to the 200-day moving average in October. Today, keep an eye on a key horizontal line around $270 and an uptrend line that currently sits near the $250 level as potential areas on the chart that may provide support.
See here for more charts to watch today.
-Tim Smith
Stocks Making the Biggest Moves Premarket
5 hr 56 min ago
Gains:
- Paramount Global (PARA): Shares of the entertainment company rose more than 1% after Wells Fargo upgraded the stock to equal weight from underweight, citing the increased probability of a merger or acquisition as rumors swirl about a potential sale.
- Coinbase Global (COIN): Shares of the cryptocurrency exchange rose more than 1% as Bitcoin and other cryptocurrencies gained amid hopes for a spot Bitcoin ETF in the coming months.
Losses:
- Argenx SE (ARGX): Shares of the Dutch pharmaceutical company fell nearly 25% after it said an experimental antibody therapy failed to meet primary and secondary goals in a late-stage clinical trial for the treatment of two skin blistering diseases.
- FedEx Corp. (FDX): Shares of the delivery and logistics company fell 11% after it reported lower-than-expected fiscal second-quarter earnings and lowered its full-year revenue outlook.
- General Mills Inc. (GIS): The packaged-food maker’s shares fell about 4% after its quarterly sales fell short of Wall Street estimates. The company said it was dealing with “slower-than-expected volume recovery” and cut its full-year sales and earnings guidance.
Futures Retreat as Rally Takes a Breather
6 hr 28 min ago
Futures contracts connected to the Dow Jones Industrial Average were down about 0.2% in premarket trading on Wednesday.
S&P 500 futures were also 0.2% lower.
Nasdaq 100 contracts slipped nearly 0.3%.
