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Market Update

Anthem in $54.2 B Deal with Cigna, AT&T Wins Approval for DirecTV


Author: Mukesh Buch
ticker.com
Last Update: 12:52 PM ET July 24 2015

12:35 PM New York – Anthem agreed to acquire rival Cigna for $54.2 billion. Amazon net swung to profit on 20% increase in revenues. AT&T net plunged 14% and won a regulatory approval for the proposed acquisition of DirecTV. Caterpillar net tumbled 29%. Visa profit climbed 25%.

Tollbooth Index fell 26.04 or 0.2% to 10,792.10.

Earnings Review

Anthem Inc (ANTM) slumped 2.7% or $4.24 to $150.99 after the health care services provider today agreed to acquire its rival Cigna Corporation for $54.2 billion or 55% cash and 45% in stock of Anthem shares.

Shareholders of Cigna will receive $103.40 in cash and 0.5152 of Anthem shares totaling about $188 for each share of Cigna.

The transaction is expected to close in the second-half of next year.

Shares of Cigna Corporation declined 4.8% to $146.98

Amazon.com, Inc (AMZN) surged 14.5% or $70.07 to $552.34 after the online retailer reported net sales in the second-quarter ending in June soared 20% to $23.18 billion from a year ago period.

Net in the quarter swung to $92 million profit or 19 cents per diluted share compared to a loss of $26 million or 27 cents from the same quarter last year.

The retailer forecasted net sales for the third quarter in the range of $23.3 billion to $25.5 billion.

AT&T Inc (T) jumped 3% or $1.02 to $34.94 after the communications services provider reported sales in the second-quarter ending in June increased 1.4% to $33.02 billion from a year ago period.

Net income in the quarter plunged 14.4% to $3.04 billion or 58 cents per diluted share compared to $3.55 billion or 68 cents from the same quarter last year.

As of June, AT&T reported cash and cash equivalents of $20.95 billion from $11.3 billion in a year ago period.

Separately, the telecom company won the Justice Department merger approval of company’s proposed $48.5 billion purchase of DirecTV after the Federal Communications Commission voted on to approve the merger.

Caterpillar Inc (CAT) fell 55 cents to $76.33 after the construction and mining equipment maker said revenues in the second-quarter ending in June declined 13% to $12.32 billion from a year ago period.

Net income in the quarter tumbled 29% to $710 million or $1.16 per diluted share compared to $999 million or $1.57 from the same quarter last year.

The company lowered full-year revenues forecast of about $49 billion from the earlier estimate of about $50 billion and held its estimated range per share between $4.70 and $5.

Cabot Oil & Gas Corporation (COG) declined 4.7% or $1.29 to $26.30 after the oil and gas company said revenues in the second-quarter ending in June plummeted 42.5% to $306.3 million from a year ago period.

Net in the quarter swung to a loss of $27.5 million or 7 cents per diluted share compared to profit of $118.4 billion or 28 cents from the same quarter last year.

Cigna Corporation (CI) dropped 4.8% or $7.39 to $146.98 after the health care services provider said preliminary results for the second-quarter in June to climb 9% to $9.5 billion and net income is forecasted to increase to $574 million or $2.21 per share compared to $573 million or $2.12 per share.

Moody''s Corporation (MCO) gained 1% or $1.16 to $112.92 after the ratings services provider said revenues in the second-quarter ending in June jumped 5% from a year ago period to $918.1 million.

Net income in the quarter plunged 18% to $261.7 million or $1.28 per diluted share compared to $319.2 million or $1.48 from the same quarter last year.

Rockwell Collins, Inc (COL) slipped 3.4% or $3.04 to $85.37 after the aviation applications designer stated total reported sales in the third-quarter ending in June rose 2% to $1.29 billion from a year ago period.

Net income in the quarter soared 12.6% to $178 million or $1.33 per diluted share compared to $158 million or $1.15 from the same quarter last year.

Rockwell forecasted revenues for the year nearly unchanged from earlier guidance between $5.25 billion and $5.30 billion but lifted its earnings per share estimate in the range of $5.15 to $5.25 from the previous estimated range between $5.10 and $5.30.

Visa Inc (V) soared 4.5% or $3.20 to $74.95 after the debit and credit card payment services provider reported revenues in the third-quarter ending in June surged 12% to $3.52 billion from a year ago period.

Net income in the quarter climbed 25% to $1.70 billion or 69 cents per diluted share compared to $1.36 billion or 54 cents from the same quarter last year.

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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