The stock market rallied to close out the week despite crude oil prices falling to under $40 a barrel. The S&P 500 was up 0.44% at the ring of the bell last week, while the Dow Jones Industrial entered the weekend with a 0.69% climb in Friday’s action.
To start off the new week, investors should be keeping their eyes peeled for action in a few stocks, including Starbucks Corporation (NASDAQ:SBUX), Tiffany & Co. (NYSE:TIF) and Sherwin-Williams Co (NYSE:SHW).
Starbucks Corporation (SBUX)
The coffee giant’s shares could be under pressure as the week kicks off thanks to a lawsuit regarding its serving portions.
The class-action suit accuses Starbucks of serving lattes that are 25% smaller than the menu claims. It claims that baristas’ pitchers have a “fill to” line that results in caffeinated beverages that don’t add up to the tall (12-ounce), grande (16-ounce) and venti (20-ounce) sizes.
The suit says that Starbucks has saved millions of dollars by underserving as it allows the company to save a substantial amount of milk.
SBUX stock is trading at roughly breakeven for the year-to-date.
Tiffany & Co. (TIF)
The momentum train continues to go Tiffany’s way thanks to its fiscal second-quarter report, which exceeded analysts’ expectations.
Excluding items, the luxury jewelry retailer reported $1.46 earnings per share, surpassing the Wall Street estimate of $1.40 EPS. Lower prices of diamonds, gold and silver helped Tiffany’s cut down on costs.
That info was one of just a couple favorable numbers for Tiffany for the quarter. A strong dollar weighed on revenues, which fell 5.6% year-over-year to $1.21 billion, and comps suffered a 10% decline, which was worse than the 9.4% drop that analysts expected. Net income was down 17% to $163.2 million as well.
The retailer did have some encouraging guidance, though, expecting earnings to start growing from the second half of its fiscal year ending January 2017.
TIF gained 3% on Friday, which extended a roughly 20% run from its February lows.
Sherwin-Williams Co (SHW)
The paint manufacturer’s shares could be on the upswing Monday amid news that the company has agreed to buy its rival.
The deal has yet to be finalized, but Sherwin-Williams is expected to buy the The Valspar Corp (NYSE:VAL) — another paint manufacturer — for $11.3 billion. The price is $113 a share, which is 35% higher than Valspar’s Friday closing price of $83.83.
Sherwin-Williams hopes to expand its international presence with the deal, as Valspar owns businesses in China, Brazil, Mexico and more.
The deal is pending approval from shareholders and regulators.
SHW shares are enjoying a fantastic year, up 11% versus a flat market.
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