GrowLife and Vape Holdings Terminate Joint Venture
GrowLife and Vape Holdings Terminate Joint Venture
Mortgage Applications Drop, Tiffany Beats but Michael Kors Doesn't
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GrowLife filed an 8K with the SEC after the market close on Friday saying it had received a fully executed termination of a planned joint venture from Vape Holdings. It did note that it received the termination on June 2, but it wasn't made public until the June 6. Both stocks are down on Monday on the news and neither company was available for comment nor did either company publish a press release regarding the venture termination. Back in March, the two companies agreed to fund and develop new pharmaceutical grade processes for cannabis extraction that could be patented.
Mortgage applications dropped 1.6 percent from a week ago, according to data from the Mortgage Bankers Association's weekly mortgage applications survey. Tiffany & Company (TIF) earnings and revenue fell less than expected in the first quarter as a key sales metric grew across nearly every region, despite the continued negative impact of the strong U.S. dollar. But Michael Kors (KORS) gave another disappointing forecast. It was helped by store openings and a lower tax rate but the retailer gave another disappointing forecast for the current quarter. Reuters reports that gourmet sub chain Jimmy John's is preparing for an IPO that could value the company at $2 billion. Widely followed investment advisor Bill Gross admitted in his June investment outlook that his bet against the German Bund market was well timed but not profitable.
On Wednesday, May 27 we keep an eye on six companies that are scheduled to report their quarterly financial results as well as a couple of economic data to watch on Wall Street. The notable earnings for the day include Michael Kors Holdings Limited (KORS), Tiffany & Co. (TIF), Toll Brothers Inc (TOL), DSW Inc (DSW), Costco Wholesale Corp (COST), and Palo Alto Networks Inc (PANW). In the morning, warehouse superstore Costco is scheduled to release its fiscal third-quarter financial results before the market opens. TheStreet’s Jim Cramer believes Costco may be an opportunity going into the quarter, saying it’s a very strong company that’s been down for quite a long time. Analysts are expecting a continued improvement from a year ago. The consensus estimate calls for a profit of $1.16 cents per share on revenue of around $26 billion for the first quarter, according to Thomson Reuters data. On the economic calendar, we note mortgage applications figures from the Mortgage Bankers' Association to get a feel for housing demand, as well as economic momentum. Also, we keep an eye on the Redbook, a weekly indicator of consumer spending. It measures comparable store sales at chain stores, discounters, and department stores. TheStreet's Kurumi Fukushima reports in New York.
Time Warner Cable (TWC) topped the S&P 500 after Charter Communications (CHTR) agreed to acquire its larger rival for around $55 billion. That marks a 14 percent premium to Time Warner's close on Friday. Investors cheered Charter's decision in which the cable operator would become the second largest in the country after Comcast (CMCSA). Charter was the best performer on the Nasdaq. The Dow saw all 30 of its components in the red, though some suffered more than others. High-momentum mover Apple (AAPL) was the biggest laggard, followed by Chevron (CVX) which had been pulled lower by a sell-off in crude oil.
Stocks plummeted on stronger economic data which exacerbated fears the Federal Reserve will hike interest rates sooner than expected. Consensus is for a September hike. The increasing possibility of a hike pushed investors into safe-haven assets including the U.S. dollar. The greenback surged to an 8-year high against the Yen and a one-month high against a basket of other international currencies. A stronger dollar was hurting commodity prices, pushing West Texas Intermediate down around 2%. Major oilers Exxon (XOM), Chevron (CVX), BP (BP) and Royal Dutch Shell (RDS.A) were lower as a result. New home sales in the U.S. rose more than expected, increasing 6.8% to an adjusted annual rate of 517,000.
In Tuesday's Analysts' Actions, TheStreet highlights upgrades for discount store chain Dollar General (DG), fashion apparel company L Brands (LB), and online auctioning site eBay (EBAY). Both Dollar General and L Brands received the highest rating by analysts at Goldman Sachs. The two companies made it on the firm's CONVICTION BUY list. Dollar General was upgraded to CONVICTION BUY from a BUY rating. The company also had its price target increased by a couple of dollars to $87 from its previous $85. Goldman Sachs analysts cited Dollar General's long-term growth and attractive valuation for the upgrade and positive note. L Brands was also added to Goldman Sachs' CONVICTION BUY list. The fashion company had its rating raised to CONVICTION BUY from BUY. The firm calls the parent company of Victoria's Secret one of the highest quality growth companies in consumer retailing, and increased its price target to $106 from its prior $104. And finally, eBay had its rating raised to BUY from HOLD by analysts at Axiom Capital Tuesday morning. Analysts at the firm gave a $10 boost to its price target to $70 from its prior $60 price objective. TheStreet's Kurumi Fukushima reports in New York.
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