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Market Update

Amazon Acquires Middle East Rival, Darden Buys Southern Chain Cheddar’s


Author: Mukesh Buch
ticker.com
Last Update: 7:04 AM ET March 28 2017

2:10 PM New York – Amazon agreed to buy Dubai-based Souq.com for $800 million. At Home net tumbled. Carnival lifted fiscal outlook. Darden agreed to acquire Cheddar’s Scratch Kitchen for $780 million. Ford plans to invest $1.2 billion in Michigan. FactSet net fell.

Tollbooth Index edged up 6.28 to 11,544.62.

Earnings Review

Amazon.com, Inc (AMZN) increased $8.19 to $854.96 after the online market-place operator agreed to acquire Dubai-based online retailer Souq.com without disclosing the price. However, local banking sources estimated deal price of $800 million.

The transaction is expected to close in 2017.

American Airlines Group Inc (AAL) rose 15 cents to $41.90 after the airline services provider agreed to acquire a minority stake in China Southern Airlines Co. for $200 million and issue 270.6 million shares at a price of HK$5.74 or worth HK$1.55 billion.

At Home Group Inc (HOME) slipped 1.6% or 25 cents to $15.35 after the home decor superstore operator said net sales in the fourth-quarter ending on January 28 soared 26.4% from a year ago to $234.5 million.

Comparable store sales in the quarter jumped 7.1%.

Net income in the quarter tumbled 98% to $15.3 million or 25 cents per diluted share from profit of $58.8 million or $1.12 in the same quarter last year.

The home furnisher lifted revenue forecast in fiscal 2017 to between 18% and 19% and net income in the range of 43% to 51% and pro forma net income growth of 25% to 30%.

Carnival Corp (CCL) gained 1.3% or 76 cents to $59.63 after the cruise operator reported revenues in the first-quarter ending in February advanced 2.7% from a year ago to $3.8 billion.

Net income in the quarter surged 147.9% to $352 million or 48 cents per diluted share from $142 million or 18 cents in the same quarter last year.

In the second-quarter, the Carnival lifted revenue growth forecast in the range of 2.5% to 3.5% and earnings per share between 43 cents and 47 cents.

The travel services provider lifted revenues estimate in fiscal 2017 to jump 3% compared to the prior year and better than December forecast of 2.5% and earnings per share in the range of $3.50 to $3.70 compared to December estimate of $3.30 to $3.60.

Darden Restaurants, Inc (DRI) jumped 8.2% or $6.18 to $81.78 after the full-service restaurant operator said revenues in the third-quarter ending on February 26 increased 1.7% from a year ago to $1.9 billion.

U.S. same restaurant sales in the quarter rose 1.4%.

Net income in the quarter surged 56.5% to $165.6 million or $1.32 per diluted share from $105.8 million or 82 cents in the same quarter last year.

The Darden lifted diluted earnings per share forecast to between $3.95 and $4.

Separately today, the restaurant operator agreed to acquire Cheddar’s Scratch Kitchen for $780 million in cash from its stockholders including private equity firms L Catterton and Oak Investment Partners.

The transaction is expected to complete in the fourth-quarter of fiscal 2017.

FactSet Research Systems Inc (FDS) declined 4.7% or $8.19 to $166.36 after the professional information services provider said reported revenues in the second-quarter ending in February jumped 4.5% from a year ago to $294.4 million.

Net income in the quarter fell 1.6% to $66.7 million or $1.68 per diluted share from $67.8 million or $1.63 in the same quarter last year.

On March 17, FactSet completed the acquisition of BISAM Technologies S.A for about $205.2 million in cash

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Sources: Data collected by 123jump.com and Ticker.com from company press releases, filings and corporate websites. Market data: BATS Exchange. Inc