Intercept Pharma (ICPT): FDA warns doctors after 19 deaths on Intercept liver drug

• Some patients died after taking excessive doses, agency says
• Company previously reported 10 deaths connected to Ocaliva

  

• 2nd day

Nineteen patients died after taking a liver-disease drug from Intercept Pharmaceuticals Inc., the U.S. Food and Drug Administration said, warning doctors about risks from a product that the company is seeking to make into a blockbuster.

While the cause of death wasn’t available in most cases, seven of the patients who died were taking the drug, called Ocaliva, more frequently than is recommended, the agency said in a safety announcement on Thursday.

The drug “is being incorrectly dosed in some patients with moderate to severe decreases in liver function, resulting in an increased risk of serious liver injury and death,” the FDA said in its warning. But it also said that the medication may be associated with liver damage in some patients with mild disease receiving the correct dose.

Intercept declined to immediately comment as it reviewed the FDA’s statement. Shares of the drugmaker sank 9.2 percent to $89.10 at 12:21 p.m. in New York.

The deaths could lead to restrictions on how Ocaliva is prescribed and additional warnings on the drug’s label, which doesn’t currently list death as a risk. The company would face a potential major safety issue as it tries to expand the drug’s use to millions of patients with other conditions.

Joseph Schwartz, an analyst at Leerink Partners, said that the new information “could tilt the FDA more toward a black box warning” calling attention to life-threatening risks.

Earlier this month, Intercept said it had reviewed 10 deaths of patients who had taken the drug. The company warned doctors that Ocaliva can cause injuries, organ failure, or death if it’s not used exactly as intended in patients with primary biliary cholangitis, a relatively rare liver condition for which the drug was approved last year.

About 15,000 prescriptions for Ocaliva have been written since it was introduced, according to data from Symphony Health Solutions compiled by Bloomberg Intelligence. The drug is Intercept’s only commercial product and was approved in the U.S. in May last year. It brought in $30.4 million in sales last quarter.

Rival treatments in testing at other drugmakers could threaten Ocaliva’s market potential if they don’t have the same risks. Intercept is in the final stages of testing Ocaliva for nonalcoholic steatohepatitis, or NASH, which is associated with being overweight.

Three percent to 12 percent of Americans have NASH, according to the U.S. National Institutes of Health -- a huge potential market. Analysts have projected that the drug will become a blockbuster, with more than $1 billion in sales by 2021, though the disclosure of deaths may change that.

=Trivago (TRVG) : issues profit warning

trivago lowers FY17 guidance due to Revenue per Qualified Referral (RPQR) impacts, FX and dificult comps

For the full fiscal year 2017, co now expects annual revenue growth to be around 40% (down from +50% vs. +51.5% consensus) and adjusted EBITDA to be lower than in 2016 but to remain positive (down from a slight increase Y/Y).

The changes to our full-year guidance are due primarily to the following two factors:

• Revenue per Qualified Referral (RPQR) related impacts:
  • The anticipated negative impact on RPQR that we discussed on our second quarter 2017 earnings call has been more significant than previously expected.
  • As a result of this impact, we have algorithmically pulled back our performance marketing activities more than previously anticipated, which has resulted in a further slowdown in traffic and revenue growth from those channels.
• Due to the speed with which the above RPQR slowdown unfolded we were unable to pull back planned television advertising spend quickly enough to prevent overspend. As a consequence, we will have lower Return on Adverting Spend (ROAS) in July and August and adjusted EBITDA margins in those months have been negatively impacted. Note that we do expect ROAS to stabilize over time with an adjustment of brand marketing expenses.
• In addition to the above two factors, the following factors are also impacting our performance:
  • Difficult revenue comps as results for summer period in 2016 were exceptionally strong as compared to 2015 and 2014, and  
  • Foreign exchange effects associated with recent weakness in the US dollar and other currencies versus the Euro.
• Although the above factors represent near term challenges, we remain unwavering in our belief in the medium to long-term potential of the business.
• As previously communicated, the company will participate in a question and answer session at the Citi Global Technology Conference in New York City today at 08:00 a.m. Eastern Time
• OTAs: EXPE owns 59.7% of EXPE; PCLN, TRIP

=Finish Line (FINL) cuts projections amid disappointing sales

• FINL releases prelim Q2 results, lowers FY18 guidance- sees Q2 sales of $469.4 mln vs. $477.8 mln Capital IQ Consensus Est, sees EPS of $0.08-0.12 vs. $0.38 consensus.

Finish Line releases prelim Q2 results, lowers FY18 guidance- sees Q2 sales of $469.4 mln vs. $477.8 mln Capital IQ Consensus Est, sees EPS of $0.08-0.12 vs. $0.38 consensus 

• Co lowers comparable sales to declining 3-5% versus its previous guidance for an increase in the low-single digit range
• Co also lowers EPS guidance to $0.50-0.60 vs. $1.11 Capital IQ Consensus Est
• Co sees Q3 loss of ($0.40)-(0.32) vs. a loss of ($0.25) consensus, company expects Finish Line comparable sales to decrease 3% to 5%
• For the fourth quarter ending March 3, 2018, a 14-week quarter, the company expects Finish Line comparable sales to decrease 3% to 5%... sees Q4 EPS of $0.50-0.58 vs. $0.74 consensus
• "The marketplace for athletic footwear became much more promotional as our second quarter progressed resulting in challenging sales and gross margin trends," said Sam Sato, Chief Executive Officer of Finish Line. "Despite these headwinds, we remained disciplined in managing our inventories and expect to end the quarter with inventory levels down ~7-8% compared with a year ago." 
• Based on year-to-date results and the expectation that sales and gross margin trends remain challenging through the remainder of the current fiscal year, co lowered full year guidance
• Sato continued, "We believe it is prudent to adjust our outlook as we expect the environment to remain highly competitive and promotional throughout the remainder of the year. In light of our disappointing second quarter results and revised projections for fiscal 2018, we will remain very disciplined in managing our expenses and inventories throughout the remainder of the year. Looking ahead, we are optimistic that the work we are doing with our vendor partners to enhance our merchandise assortments will start benefiting our top-line results early next year. At the same time, we continue to focus on building our omnichannel capabilities to strengthen our customer connections, improve our service levels and further capitalize on the shift toward digital commerce. We are also making good progress rightsizing the business to better compete in the current environment. In the past 12-months, we've made a number of changes that have created a more nimble organization and generated approximately $6 million in annualized savings, and over the past 2 years we've closed ~80 underperforming stores. We remain steadfastly focused on executing our strategic plan to drive increased shareholder value over the longer term."

Hibbett Sports (HIBB) announces dismal earnings and same-store-sales guidance

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Sports retailer Hibbett Sports (HIBB) warned that it expects second-quarter same-store sales to fall about 10%, citing "very challenging sales trends." The company said the decline, combined with "significant" pressure on gross margin, would push it to a loss of 19 cents to 22 cents for the quarter. The current FactSet consensus is for second-quarter earnings per share of 15 cents. The company said it is launching an e-commerce site, www.Hibbett.com, that will offer footwear, clothing and equipment. "Despite the difficult retail environment, the company remains focused on improving its business for the long term," Chief Executive Jeff Rosenthal said in a statement. "Launching an e-commerce site has been a key strategic goal for Hibbett, and we took time to invest in our omni-channel infrastructure to do it the right way." The stock has fallen 47% in 2017, while the S&P 500 (SPX) has gained 10.4%.

CyberArk (CYBR) plunges after preannouncing Q2 revenue miss

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CyberArk Software (CYBR) stock plunged after the computer security software provider preannounced June-quarter revenue that missed consensus estimates.

The company blamed the Q2 miss on weakness in its business in Europe and the Middle East.

"We are disappointed that our results for the second quarter will be below the guidance we provided in May," CyberArk CEO Udi Mokady said in a news release. "The primary reason for our revenue shortfall was our performance in EMEA, where certain deals that we anticipated would close did not close by the end of the quarter."

CyberArk is based in Israel and Newton, Mass.

CyberArk said it expects second-quarter revenue in a range of $57 million to $57.5 million vs. analyst estimates of $62 million. The company earlier had forecast revenue of $61.5 million at the midpoint of its guidance.

CyberArk expects non-GAAP operating income in the range of $8.5 million to $8.9 million vs. earlier guidance of  $11.3 million.

Analysts had estimated Q2 non-GAAP profit of 24 cents.

CyberArk will report Q2 results on Aug. 8.

Hackers often aim to compromise networks by targeting employees or management with administrative access to company computer systems. CyberArk's software monitors and manages privileged accounts.

=Diebold (DBD) lowers guidance

• Cuts FY17 guidance citing elongated conversion cycles for large orders in banking and the delay in systems rollouts in the service business 
• Related stocks: PAY, NCR.

Diebold Nixdorf cuts FY17 guidance citing elongated conversion cycles for large orders in banking and the delay in systems rollouts in the service business :

Co lowers FY17 non-GAAP EPS to $0.95-1.15 from $1.40-1.70 vs. $1.58 CIQ consensus; lowers FY17 rev to $4.7-4.8 bln from $5.0 bln vs. $5.0 bln consensus.

The company is in the process of closing its books for the second quarter 2017, and expects orders, revenue ($1.10 bln) and adjusted EBITDA in the period to be comparable with first quarter results (Q2 consensus $1.13 bln).

As previously disclosed, the company's banking business is increasingly made up of large, complex projects with higher software content, resulting in a longer customer decision-making process and order-to-revenue conversion cycle. As a result, the timing and volume of orders to date leads the company to adjust its 2017 guidance.

In addition, the delay in systems rollouts also has a negative impact on the company's service business. This change in volume, combined with investments in hiring and training in the service organization as part of the company's transformation, will pressure near-term margins.

"We are encouraged by the positive feedback we are receiving from customers, which demonstrates our strong competitive position," said Andy W. Mattes, president and chief executive officer, Diebold Nixdorf. "Clearly, we are disappointed in our near-term financial performance. That said, we continue to improve our operating expenses from the prior year and are taking steps to further accelerate our cost reductions. As a result, we are increasing our DN2020 net savings target to $240 million. We are committed to realizing the full potential of our new company and delivering results for all our stakeholders."

=O'Reilly Automotive (ORLY) warns of weaker-than-expected comps

• Worst day ever for ORLY

O'Reilly Auto sees Q2 comps +1.7% vs. +3-5% guidance :

• comparable store sales results of 1.7%, which fell short of previously issued second quarter comparable store sales guidance of 3% to 5%, and announced the release date for its full second quarter 2017 results as Wednesday, July 26, 2017, with a conference call to follow on Thursday, July 27, 2017.
• Greg Henslee, O'Reilly's CEO stated, "After exiting the first quarter and entering April on an improved sales trend, we faced a more challenging sales environment than we expected for the remainder of the quarter. Our second quarter comparable store sales results of 1.7% represent an improvement over our first quarter, but fell below our guidance of 3% to 5%, due to what we believe were continued headwinds from a second consecutive mild winter and overall weak consumer demand. The comparable store sales shortfall will also have a consequent impact on our operating profitability, which we will report in our full second quarter earnings release on July 26th." Mr. Henslee added, "While we are disappointed with our sales results in the first half of the year, we remain confident in the long-term health of our industry and our team's ability to provide exceptional customer service and take market share in this challenging demand environment."
• Peers: AAP, AZO, GPC

Snack maker Snyder's-Lance (LNCE) swaps CEOs, warns of weakness

Snyder’s-Lance Inc. said Monday that Chief Executive Carl Lee Jr. has retired after 12 years at the company, and the maker of Kettle Brand and Cape Cod chips braced investors for weakness going forward.

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Snyder's-Lance sees Q1 results lower than consensus; lowers FY17 outlook; CEO retires; Brian Driscoll to step in as interim CEO :

Co announces CEO Transition and provides preliminary Q1 results, as well as updating FY17 guidance

• Q1
  • Co issues downside guidance for Q1 (Mar), sees EPS of 0.13-0.14, excluding non-recurring items, vs. $0.27 Capital IQ Consensus Estimate
  • Co sees Q1 (Mar) revs of $530-532 vs. $551.13 mln Capital IQ Consensus Estimate.
• FY17
  • Co issues downside guidance for FY17 (Dec), sees EPS of $1.05-1.20, excluding non-recurring items, vs. $1.38 Capital IQ Consensus Estimate, and down from prior guidance of $1.24-1.30
  • Co sees FY17 (Dec) revs of $2.2-2.25 bln vs. $2.27 bln Capital IQ Consensus Estimate, and down from prior guidance of $2.29-2.31 bln

CEO Transition

• Co also announced that its President and CEO, Carl Lee, Jr, has retired.
• Brian Driscoll, former President and CEO of Diamond Foods and a current Director of Snyder's-Lance, has agreed to step in as interim CEO.
• The Company has announced that it will launch a national search for a permanent replacement to Lee.
• Driscoll is considered a strong candidate for that role, and will have full faith and confidence of the Board to develop and execute the Company's strategies until a permanent decision is made.

=Sears (SHLD) has "substantial doubt" about its future

• Discloses in 10-K that its operating results indicate substantial doubt exists related to the Company's ability to continue as a going concern.

March 21 (Reuters) - Retailer Sears Holdings Corp, which has struggled with years of losses and declining sales, warned on Tuesday about its ability to continue as a going concern.

"Our historical operating results indicate substantial doubt exists related to the company's ability to continue as a going concern," Sears said in the annual report for the fiscal year ended Jan. 28. 

Once the largest U.S. retailer, Sears has spun off some of its stores into a real estate investment trust, put some brands on sale and repeatedly raised debt from billionaire Chief Executive Edward Lampert's hedge fund to cope with the slump.

The company said last month it would cut costs by $1 billion and reduce debt and pension obligations by at least $1.5 billion this year.

Sears said on Tuesday actions taken during the year to boost liquidity, including the sale of the Craftsman tool brand to power tool maker Stanley Black & Decker Inc in a $900 million deal, could mitigate the going concern doubt and satisfy its capital needs for the current fiscal year.

However, the company said it could not predict with certainty the outcome of its actions to generate liquidity.

Sears, which had total borrowings of $4.16 billion as of Jan. 28, said it would continue to explore ways to unlock value across a range of assets.

Ericsson (ERIC) releases preliminary Q3 results that were worse than expected

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Ericsson sees Q3 revs below consensus:

• Co issues downside guidance for Q3 (Sep), sees Q3 (Sep) revs of SEK51.1 bln vs. SEK53.62 bln Capital IQ Consensus Estimate.
• Sales declined by -14% YoY, driven by slower development in Segment Networks where sales declined by -19%.
• Negative industry trends from first half 2016, with weaker demand for mobile broadband, especially in markets with weak macro- economic environment, have further accelerated.
• Gross margin declined to 28% (34%) following lower volumes in Segment Networks, lower mobile broadband capacity sales, and higher share of services sales.
• Operating income declined to SEK 0.3 bln (SEK5.1 bln), including restructuring charges of SEK 1.3 bln.

Fortinet (FTNT) lowers Q3 revenue outlook

 

Fortinet lowers Q3 revenue outlook to $311-316 mln vs. $322.4 mln Capital IQ Consensus Est, down from $319-324 mln, lowers EPS to $0.15-0.16 vs. $0.18 consensus, from $0.17-0.18; co also authorized a $100 million increase to its existing share repurchase program :

• Based on preliminary financial information, Fortinet expects total billings1 to be in the range of $343-348 mln compared to its previously announced guidance of $372-376 mln
• Co said, "Our third quarter results were primarily impacted by the lengthening of deal cycles as enterprises are becoming more strategic with their purchasing decisions and buying with less urgency than last year. We also encountered sales execution challenges in the North America resulting from the newness of our sales organization, as well as macro issues in Latin America and the U.K. Though we are disappointed with our third quarter performance, we continue to feel good about our competitive-differentiating and market-leading security fabric. We remain confident in the underlying strength of our business and long-term growth opportunity, and committed to delivering returns to our shareholders."
• Shares of FTNT initially tanked 18% to $28/share following this guidance
• Peers including FireEye (FEYE) Palo Alto Networks (PANW), and Checkpoint (CHKP)  were lower in sympathy after hours.

Wed 12 Oct 2016

PFPT -4.3% (in sympathy with FTNT)

PANW -3.5% (in sympathy with FTNT)

CHKP -3.4% (in sympathy with FTNT)

IMPV -2.6% (in sympathy with FTNT)

CYBR -2.5% (in sympathy with FTNT)

CSCO -0.8% (in sympathy with FTNT, through Symantec unit)

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Rent-A-Center (RCII) warns of profit miss

Rent-A-Center Inc. RCII, -29.27% said Tuesday it expects third-quarter earnings per share, on both a GAAP and adjusted basis, of 5 cents to 15 cents. That's well below the FactSet EPS consensus of 39 cents. U.S. same-store sales are expected to be down about 12%.

  

Rent-A-Center sees Q3 EPS well below consensus with core US comps down 12%; cites performance issues and outages related to new POS system:

Co sees Q3 EPS $0.05-0.15 vs $0.39 Capital IQ Consensus Estimate.

• The Company estimates Core U.S. same storesales for the three months ended September 30, 2016 to be down ~12%, and Acceptance Now same store sales to be essentially flat.
• Core U.S. gross profit, as a percent of total revenue, is estimated to be flat compared to the third quarter of last year as ongoing benefits from the changes made to the Company's sourcing model were offset by a third-quarter clearance event focused on previously-rented product.
• "Following the implementation of our new point-of-sale system, we experienced system performance issues and outages that resulted in a larger than expected negative impact on Core sales," said Robert D. Davis, Chief Executive Officer of Rent-A-Center, Inc. "While we expect it to take several quarters to fully recover from the impact to the Core portfolio, system performance has improved dramatically and we have started to see early indicators of collections improvement."
• The Company recently obtained an amendment to its credit agreement which reduces the minimum Consolidated Fixed Charge Coverage Ratio from 1.75 to 1.00 to 1.50 to 1.00, beginning with the quarter ended September 30, 2016. Co will report on Oct 26.

====Hain Celestial (HAIN) delays release of its Q4 and FY16 results

Hain Celestial (NASDAQ: HAIN) — The organic food maker announced a delay in its annual earnings report because of accounting issue. Hain also said it did not expect to reach prior targets for sales or profit for the fiscal year that ended June 30.

Synchrony Financial (SYF) warns of higher charge-off rates.

• Synchrony Financial‘s (SYF) warned that its net charge-off rates would be worse than anticipated over the next year.
• It was Synchrony's biggest one-day price and percentage declines since it went public in 2014.
• Synchrony shares have fallen 13% year to date.

• One week later:

Synchrony, a recent General Electric (GE) spinoff that provides private-label credit cards to a variety of businesses, said it expected a 20-30 basis point increase in net charge-off rates — a measure of debt that a company no longer expects to get back and has deemed a loss — and would build up reserves accordingly in Q2.

While Synchrony said it expected some level of weakness and that its loss rate was “at historically low levels,” the announcement came amid growing anxiety about consumer debt.

And as auto loans grow, so have warnings about potentially higher delinquencies. Other analysts have said banks are running out of higher-quality borrowers to target, forcing them to reach for less reliable ones.

Under Armour (UA) warns after Sports Authority bankruptcy

 

Under Armour (UA) drops following the company lowering its FY16 outlook to account for the bankruptcy of The Sports Authority
Under Armour Inc. says it now expects to take in $120 million less revenue than planned from sales of its sportswear at Sports Authority stores as the retail chain prepares to go out of business. Baltimore-based Under Armour (NYSE: UA) announced it will take a $23 million second-quarter charge tied to Sports Authority's liquidation plans.

In a federal filing, it said Sports Authority's bankruptcy means it will only be able to collect $43 million of the originally planned $163 million in revenue it expected through sales of its merchandise at Sports Authority stores for 2016.

Under Armour is a major supplier to Englewood, Colorado-based Sports Authority, which began liquidating merchandise from its 450 stores recently and is selling off store leases in late June.

In March, when Sports Authority filed for chapter 11 bankruptcy protection, Under Armour said it did not expect the move to impact the company's outlook for 2016. But that changed when Sports Authority said it no longer planned to restructure.

Under Armour had previously projected revenue for 2016 of $5 billion, representing growth of 26 percent over last year. The company now expects revenue of $4.925 billion, up 24 percent over last year.

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Hertz Global (HTZ) lowers Q1 and FY16 guidance

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Hertz Global lowers Q1 and FY16 rev per available car day guidance due to excess industry capacity; reaffirms FY16 EBITDA, sees FY16 EPS in-line:

Due to what the co believes is excess industry capacity, it now expects its first quarter and full year 2016 U.S. car rental (U.S. RAC) revenue and consolidated first quarter adjusted earnings per share to be lower than previously expected.

Despite this reduction, the co is affirming its full-year 2016 adjusted Corporate EBITDA guidance within a range of $1.6 to $1.7 billion.

For the first quarter 2016, Hertz Global Holdings expects U.S. RAC revenue per available car day (:RACD) to decline between 2.5 to 3.5 percent versus the same period last year on low single-digit growth in transaction days.

For the full year 2016, Hertz Global Holdings now expects U.S. RAC total revenue to be flat to 1.5 percent lower versus the co's previous guidance of 1.5 to 2.5 percent growth year over year. The company continues to expect modest U.S. RAC transaction day growth in 2016, primarily driven by its on-airport business. In addition to maintaining its 2016 adjusted Corporate EBITDA guidance, the co sees FY16 adj. EPS $0.95-1.10 vs. $1.04 consensus.

"We are disappointed that the pricing pressure experienced late in 2015 further intensified in the first quarter of 2016. However, we believe that industry capacity will likely moderate as seasonal demand improves establishing the foundation for a relative improvement in pricing as we head into the peak summer season."

Hertz Global Holdings continues to expect to achieve $350 million of incremental savings in 2016. Similar to 2015, the company expects a lower rate of savings realization during the first half of the year as targeted initiatives ramp up throughout 2016.

Peer: Avis (CAR).

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Yum Brands (YUM) warns about weak sales in China

Parent company of KFC, Pizza Hut and Taco Bell, Yum Brands Inc. (YUM) surprised investors, warning that sales in China have recently softened, and the fast-food chain gave a weaker-than-expected earnings growth outlook for next year.

Louisville, Ky.-based Yum said it expects this weakness to be offset by results from other overseas markets and its U.S. division. But its projection that per-share earnings, excluding special items, will rise 10% next year fell short of the 14% growth recently projected by analysts polled by Thomson Reuters.

Yum has been one of the most successful foreign companies in China, with roughly 5,000 restaurants in the country—more than other American fast-food chains have built. While that is far fewer than the 18,000-plus locations it has in the U.S., Yum's much faster growth rate and quicker return on investments in China has made that division arguably the company's most important.