Shrugging off what appears to be a terrorist attack in Germany and perhaps in celebration of a mostly undramatic casting of Presidential ballots by the nation’s 2016 electoral college, stocks advanced again today. The S&P 500‘s gain of 0.36% left it at 2,270.76.
That rising tide didn’t left all boats though. Flotek Industries Inc (NYSE:FTK), Praxair, Inc. (NYSE:PX) and General Mills, Inc. (NYSE:GIS) all fought uphill battles, and lost.
Here’s the deal.
General Mills, Inc. (GIS)
Not only did food giant General Mills report weaker year-over-year fiscal Q2 income this morning, that lower figure still managed to fall short of analyst estimates. The pros were calling for a profit of 86 cents per share of GIS, and the company only earned an adjusted profit of 85 cents. Revenue of $4.11 billion was down 7%, versus estimates of $4.22 billion.
The crux of the headwind was, of all things, yogurt. While its Annie’s and Old El Paso brands showed strength last quarter, its Yoplait line suffered. Sales of its yogurt fell 18% year-over-year, as competition from Chobani and Dannon was fierce.
Product overhauls and updates aren’t going to help anytime soon either. The company is looking for sales to fall between 3% and 4% in 2017.
GIS ended the day down 2.6%.
Praxair, Inc. (PX)
It was billed as a “merger of equals,” designed to cull $1 billion in expenses between the two companies. But, the 3.7% tumble Praxair shares took today says PX shareholders are either unhappy with the terms of the deal, unsure such synergies can be realized in partnership with Linde AG NPV (OTCMKTS:LNAGF), or both.
The pairing, announced this morning, values Linde AG at approximately $35 billion, and would create a $66 billion giant within the industrial gas industry.
Praxair CEO and Chairman Steve Angel commented:
“The strategic combination between Linde and Praxair would leverage the complementary strengths of each across a larger global footprint and create a more resilient portfolio with increased exposure to long-term macro growth trends. We consider this to be a true strategic merger.”
The two companies were in merger discussions earlier in the year, but those talks broke down when Angel and then Linde CEO Wolfgang Buechele couldn’t come to an agreement. Linde’s new leadership didn’t have any qualms about the pairing.
Flotek Industries Inc (FTK)
Last but not least, it wasn’t exactly shocking news to learn oil services and equipment company Flotek Industries wasn’t doing especially well for the quarter currently underway. It was a little shocking to FTK shareholders, however, to learn just how tough the fourth quarter has been thus far for the outfit.
Flotek Industries gave the market a glimpse into what to expect for its Q4, warning that despite a 10% to 15% uptick in energy-chemistry revenue, margins would actually peel back from the previous quarter’s gross profit of 40.4% to something in the range of 38% to 40%. Its consumer and industrial chemistry revenue is expected to fall, sequentially, between $2.5 million and $3.5 million for the fourth quarter.
Surprised FTK shareholders sent the stock a whopping 14.6% lower.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.
