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Market Update

Cigna, Express Scripts in $67 B Deal; Kroger Falls on Weak Outlook


Author: Mukesh Buch
ticker.com
Last Update: 11:48 AM EST March 08 2018

11:40 AM New York City, New York American Eagle plunged despite stronger-than-expected results. Burlington Stores reported strong fourth-quarter results. Cigna agreed to acquire Express Scripts in $67 billion deal. Kroger and Tech Data tumbled on weak outlook. Vail Resorts net surged 58%.

Tollbooth Index increased 64.12 or 0.4% to 14,525.80.

Earnings Review

American Eagle Outfitters, Inc (AEO) plunged 8.5% or $1.75 to $18.82 after the multi-brand specialty retailer said net sales in the fourth-quarter ending on February 3 soared 13% from a year ago to $1.2 billion.

Comparable store sales in the quarter jumped 8%.

Net income in the quarter surged 72% to $94 million or 52 cents per diluted share from $54.6 million or 30 cents in the same quarter last year.

The retailer reaffirmed first-quarter comparable sales outlook to increase in mid-single digits and diluted earnings per share in the range of 20 cents to 22 cents.

Burlington Stores Inc (BURL) soared 7% or $8.16 to $124.24 after the branded apparel retailer reported total sales in the fourth-quarter ending on February 3 jumped 14.9% from a year ago to $1.9 billion.

Comparable store sales in the quarter advanced 5.9%.

Net income in the quarter soared 92% to $240.7 million or $3.47 per diluted share from $125.6 million or $1.77 in the same quarter last year.

Burlington Stores estimated fiscal 2018 total sales growth in the range of 9% to 10% and comparable store sales to increase between 2% and 3% and diluted earnings per share in the range of $5.73 to $5.83.

Cigna Corporation (CI) tumbled 9.5% or $18.54 to $175.64 after the health services provider agreed to acquire Express Scripts Holding Company for $48.75 in cash and 0.2434 shares of stock or $67 billion, including debt of $15 billion.

Upon completion of the transaction, Cigna estimated debt of about $41.1 billion and debt-to-capitalization ratio of about 49% following the acquisition.

The transaction is expected to close by the end of December 31, 2018.

The Kroger Co (KR) plummeted 10.3% or $2.72 to $23.51 after the food retailer said total sales in the fourth-quarter ending on February 3 advanced 12.3% from a year ago to $31 billion.

Net income in the quarter jumped 68.8% to $854 million or 96 cents per diluted share from $506 million or 53 cents in the same quarter last year.

Kroger forecasted fiscal 2018 diluted earnings per share between $1.95 and $2.15, below the estimate of $2.15.

RadNet Inc (RDNT) jumped 7% or 72 cents to $11.07 after the outpatient diagnostic imaging services provider stated total revenues in the fourth-quarter ending in January increased 4.7% from a year ago to $235.6 million.

Net income in the quarter doubled to $6.3 million or 13 cents per diluted share from $3.7 million or 8 cents in the same quarter last year.

RadNet forecasted fiscal 2018 total revenue growth in the range of $950 million to $975 million and operating profit of about $145 million to $155 million.

Tech Data Corporation (TECD) tumbled 19.1% or $20.51 to $87.11 after the computer and electronics products retailer said net sales in the fourth-quarter ending in January jumped 49% from a year ago to $11.1 billion.

Net income in the quarter plunged 98% to $1.3 million or 3 cents per diluted share from $78.8 million or $2.22 in the same quarter last year.

Tech Data forecasted first-quarter revenues in the range of $8 billion to $8.3 billion and diluted earnings per share in the range of 37 cents to 67 cents.

Vail Resorts, Inc (MTN) soared 6.2% or $13.34 to $230.15 after the mountain resort operator said total revenues in the second-quarter ending in January rose 1.3% from a year ago to $734.6 million.

Net income in the quarter surged 58% to $235.7 million or $5.67 per diluted share from $149.2 million or $3.63 in the same quarter last year.

Vail Resorts estimated fiscal 2018 net income between $357 million and $391 million and operating profit in the range of $607 million and $627 million.

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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