Solid Data Overshadowing Japan Uncertainty (LULU, GES, ROST, WGO, FDX, GTLS, OPLK)
Stocks rebounded on the day, as solid economic data and an upbeat outlook from economic barometer FedEx (FDX) overshadowed the continued uncertainty over the Fukushima Dai-ichi nuclear plant in Japan. The economy continues to show strength, and at this time, we don’t think the situation in Japan will have a big impact on the U.S. economy as long as a major nuclear disaster doesn’t impact Tokyo. However, we continue to expect the market to be volatile in the near term.
The Industrial Gas Stocks Index was the top performing tickerspy Index on the day, led by Chart Industries (GTLS) with a 13% gain. The Optical Networking Stocks Index was the day’s worst performing tickerspy Index, with Oplink Communications (OPLK) down -8%.
Stocks rose on the day, with the Dow climbing 161 points to 11,775. The S&P jumped 17 points to 1,274, while the Nasdaq advanced 19 points to 2,636. Oil bolted $3.44 higher to $101.42 a barrel, while gold added $8.10 to $1,404.20 an ounce.
In economic news, new claims for jobless benefits fell last week by -16,000 to a seasonally adjusted 385,000. Economists were expecting a reading of 387,000 new claims. The previous week’s figure was revised up to 401,000 from 397,000. The four-week moving average dipped by -7,000 to 386,250, the lowest level since July 2008. Elsewhere, the Federal Reserve Bank of Philadelphia said its manufacturing index jumped to 43.4 in March from 35.9 in February, well above the reading of 32.0 that economists were forecasting. The February-March jump is the biggest seen in 27 years. Led by higher energy prices, the Consumer Price Index rose 0.5% in February. Core inflation, which excludes volatile food and energy prices, rose 0.2%. Economists were expecting readings of 0.4% and 0.1%, respectively.
In earnings news, athletic apparel maker Lululemon (LULU) said its fourth-quarter profit surged 92% to $54.8 million, or 76 cents per share, from $28.5 million, or 40 cents per share, a year earlier. Excluding one-time items, the Canadian company earned 64 cents a share. Revenue rose 53% to $254.4 million. Analysts were expecting a profit of 56 cents on sales of $237.6 million. Lululemon gave first-quarter profit and revenue guidance of 36-38 cents a share and $175-$180 million. Analysts were expecting EPS of 36 cents on sales of $179.2 million. For the full year, the company expects to earn $1.90-$2.00 a share on revenue of $885-$900 million. Analysts were expecting a profit of $1.88 on sales of $895.3 million. Shares of Lululemon fell -3.8%. Eleven pros held Lululemon in their portfolios at the end of 2010 and almost 260 tickerspy members own the stock in their portfolios.
Shares of apparel retailer Guess (GES) plunged -14.0% after the company issued weak Q1 guidance. For Q4, Guess posted a profit of $103.3 million, or $1.11 per share, compared with $86.6 million, or 93 cents per share, a year earlier. Revenue rose 18% to $756.9 million. Analysts were expecting a profit of $1.06 on revenue of $724.5 million. Guess forecast a first-quarter profit of 41-44 cents a share on sales of $555-$570 million and a full-year profit of $3.30-$3.50 a share on sales of $2.72-$2.82 billion. Analysts were expecting a first-quarter profit of 62 cents on revenue of $596 million and a full-year profit of $3.50 on sales of $2.74 billion. Seven pros held Guess in their portfolios at the end of 2010, and 110 tickerspy members own the stock in their portfolios.
Ross Stores (ROST), the off-price discount retailer of designer brands, reported a fourth-quarter profit of $161.8 million, or $1.37 per share, compared with $142.8 million, or $1.16 per share, a year earlier. Those results matched Wall Street estimates. Sales rose 8.4% to $2.15 billion, while same-store sales increased by 4.0%. The California-based company voted to raise its quarterly dividend by 38% to 22 cents a share. Shares of Ross Stores rose 1.0%.
Shares of Winnebago Industries (WGO) dropped -11.9% after the company said its fiscal second-quarter revenue and order backlog fell. Profits for the period rose to $3.32 million, or 11 cents per share, from $706,000, or 2 cents a share, a year earlier, but revenue slipped -4% to $106.6 million. Analysts were expecting a profit of 6 cents a share. Its sales order backlog plunged -17.4% year over year.
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