Tuesday was a strong day for the U.S. stock market, as the pace of new-home sales roared to its highest level since the recession hit the country. The S&P 500 surged 1.4% over the course of the day, while the Dow Jones Industrial Average climbed 1.2% higher.
Heading into Wednesday, some of the biggest news of the day is coming courtesy of Hewlett Packard Enterprise Co (NYSE:HPE), Intuit Inc. (NASDAQ:INTU) and Tiffany & Co. (NYSE:TIF) — mostly on earnings news, as well as a little dealmaking.
Here’s how these companies are looking to move today:
Hewlett Packard Enterprise Co (HPE)
HPE shares were skyrocketing Wednesday morning as Hewlett Packard Enterprise both reported earnings and announced a spinoff.
For its second quarter, the IT company revealed that adjusted earnings came in at 42 cents per share, lower year-over-year by a penny and simply matching Wall Street estimates. Revenues of $12.71 billion were 1.3% higher, and they did manage to clear analysts’ hurdle of $12.33 billion.
However, the bigger news of the day is that Hewlett Packard Enterprise will be spinning off the majority of its tech services operations — and that entity will merge with Computer Sciences Corporation (NYSE:CSC), another IT company, in an $8.5 billion deal.
The CEO and chairman of the new company will be Computer Sciences CEO Mike Lawrie, while Hewlett Packard Enterprise chief Meg Whitman will be part of the board.
HPE shares were up more than 10% in Wednesday’s premarket trading, while CSC was rocketing by 22%.
Intuit Inc. (INTU)
Intuit also had quarterly earnings data to share that beat Wall Street projections.
The financial solutions provider reported earnings of $3.43 a share, excluding certain items. Analysts polled by Thomson Reuters predicted EPS of $3.21. Meanwhile, revenues of $2.3 billion topped expectations of $2.25 billion. That was led by Intuit’s TurboTax Online business, which grew by 12% last quarter.
Meanwhile, INTU also updated its earnings guidance for the current fiscal year. Adjusted earnings are expected to come in between $3.63 and $3.65 per share on revenue of $4.66 billion to $4.68 billion this year.
Current-quarter guidance beat too, with a breakeven quarter on revenues of $720 million to $740 million topping expectations of a penny loss on $719 million.
INTU stock, however, might be a victim of its own success. After shooting up 6% in the past three days, Intuit shares are actually off 2% in Tuesday’s premarket trade despite the quality quarter.
Tiffany & Co. (TIF)
Lastly, Tiffany’s struggles look to continue Wednesday after reporting its “steepest sales drop in six quarters,” according to Reuters.
Tiffany earned 69 cents per share, coming well under Thomson Reuters I/B/E/S expectations of 79 cents per share. Meanwhile, revenues sank 7.4% to $891.3 million, also failing to clear Wall Street’s bar of $915.1 million.
The sales weakness came on a 10% decline in comparable-store sales in the Americas, which was roughly a percentage point worse than the Street’s estimates.
The future is equally as discouraging, as it guided lower for the full year, from a flat to mid-single-digit percentage decline in profits to simply a mid-single-digit percentage decline.
TIF was off 5% in Wednesday’s premarket trade.
As of this writing, Karl Utermohlen did not hold a position in any of the aforementioned securities.
