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Market Update

Teva in $40.5 B Deal with Allergan, McGraw to Acquires SNL Financial


Author: Mukesh Buch
ticker.com
Last Update: 1:19 PM ET July 27 2015

1:15 PM New York Teva agreed to acquire Allergan for $40.5 billion and withdrew its proposal to acquire Mylan. McGraw agreed to buy SNL Financial $2.2 billion. Biogen lowered revenues forecast. Johnson Controls net rose but sales fell. Norfolk net tumbled 23%.

Tollbooth Index slipped 63.09 or 0.6% to 10,684.22.

Earnings Review

Biogen Inc (BIIB) jumped 4.2% or $12.53 to $312.60 after the biopharmaceutical company said total revenues in the second-quarter ending in June jumped 7% to $2.59 billion from a year ago period.

Net income in the quarter surged 29.8% to $927.3 million or $3.93 per diluted share compared to $714.5 million or $3.01 from the same quarter last year.

The biopharmaceutical company lowered its revenues forecast for the year between 6% and 8% and adjusted earnings per share in the range of $15.50 to $15.95.

Johnson Controls Inc (JCI) rose 8 cents to $44.35 after the diversified technology company reported net sales in the second-quarter ending in June slipped 2% to $9.61 billion from a year ago period.

Net income in the quarter rose 1.1% to $178 million or 27 cents per diluted share compared to $176 million or 26 cents from the same quarter last year.

For the fourth-quarter, the company forecasted earnings per share from continuing operations of $1 to $1.03.

McGraw Hill Financial Inc (MHFI) plunged 6.2% or $6.49 to $99.09 after the benchmarks and ratings services provider agreed to acquire a financial data and information company SNL Financial for about $2.23 billion.

McGraw said it may finance $525 million in cash and $1.7 billion in new debt.

The transaction is expected to close in the third quarter of this year.

Separately, the ratings and financial statistical data provider reported sales in the second-quarter ending in June increased 3% to $1.34 billion from a year ago period.

Net income in the quarter soared 21% to $353 million or $1.28 per diluted share compared to $292 million or $1.06 from the same quarter last year.

The company reaffirmed its full-year forecast for adjusted earnings per share between $4.35 and $4.45.

Norfolk Southern Corp (NSC) gained 56 cents to $83.52 after the railroad operator stated total revenues in the second-quarter ending in June declined 10.9% to $2.71 billion from a year ago period.

Net income in the quarter tumbled 22.9% to $433 million or $1.41 per diluted share compared to $562 million or $1.79 from the same quarter last year.

Roper Technologies Inc (ROP) declined 4.8% or $8.27 to $163.84 after the diversified technology company provider reported net sales in the second-quarter ending in June edged up 0.5% to $889.5 million from a year ago period.

Net income in the quarter climbed 8.8% to $171.3 million or $1.69 per diluted share compared to $157.4 million or $1.56 from the same quarter last year.

The company forecasted diluted earnings per share for the third-quarter in the range of $1.53 to $1.57.

Roper forecasted diluted earnings per share for the year in the range of $6.61 to $6.75 from previous guidance between $6.75 and $6.95.

RPM International Inc (RPM) slipped 1.8% or 83 cents to $45.14 after the specialty chemical product maker said net sales in the fourth-quarter ending in June climbed 7.5% to $1.37 billion from a year ago period.

Net income in the quarter soared 17.7% to $128 million or 94 cents per diluted share compared to $108.8 million or 80 from the same quarter last year.

Teva Pharmaceutical Industries Ltd (TEVA) surged 12.7% or $7.84 to $69.68 after the generic pharmaceuticals maker agreed to acquire generic drugs business of Ireland-based Allergan Plc for about $40.5 billion in a cash and stock.

The generic drugs maker received $33.75 billion in cash and shares valued at $6.75 billion of Teva.

The transaction is expected to close in the first quarter of 2016.

Separately, the company said it has withdrawn its proposal to acquire all of the outstanding ordinary shares of Mylan N.V.

Separately, Teva said revenues in the second-quarter ending in June slid 2% to $4.97 billion from a year ago period.

Net income in the quarter climbed 8.8% to $171.3 million or $1.69 per diluted share compared to $157.4 million or $1.56 from the same quarter last year.

Teva added free cash flow as of June 30, of about $1.3 billion jump 51% from the second-quarter of 2014.

The company lifted earnings per share forecast for the year in the range of $5.15 to $5.40 compared to previous estimated range between $5.05 and $5.35.

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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