The start of earnings season was marked with a stock market rally and a surge in oil prices on Tuesday.The S&P 500 was in the black at day’s end, finishing 1% higher, while the Dow Jones Industrial Average was up a strong 0.9%.
CSX Corporation (NASDAQ:CSX) and Adtran, Inc. (NASDAQ:ADTN) released their quarterly earnings, while Valeant Pharmaceuticals Intl Inc (NYSE:VRX) was hit with more troubling news.
Here’s what you need to know.
Valeant Pharmaceuticals Intl Inc (VRX)
Valeant Pharmaceuticals shares look likely to open Wednesday lower after a default notice from one of its bondholders.
The company was informed of a potential default by multi-strategy investment firm Centerbridge Parents thanks to Valeant’s failure to file its annual report in a timely fashion. The firm has a stake of about $250 million in the company, which accounts for 5.5% of VRX shares.
The pharmaceutical giant’s first default notice came in the form of a warning issued during its most recent preliminary earnings call, on March 15. Valeant has until June 11 to file the K-form if the company is to avoid the default.
VRX is off 3% in Wednesday’s premarket trading.
CSX Corporation (CSX)
Rail company CSX posted its fiscal first-quarter results Tuesday afternoon, and despite a lackluster report, shares appear to be headed higher.
CSX merely met the consensus earnings estimate of 37 cents per share, and revenues of $2.62 billion actually fell below a bar for $2.68 billion. Those figures were 18% and 14% lower year-over-year as well.
CSX’s revenue miss was partially caused by a decreased volume of coal shipments, falling 31% in the quarter. The company has reduced costs by cutting workers in recent months.
Nonetheless, Wall Street is driving CSX shares 3% higher in Wednesday’s premarket action, which could help CSX bounce off its 50-day moving average.
Adtran, Inc. (ADTN)
The telecommunications network provider posted its first-quarter earnings Tuesday afternoon, and shares were popping as a result.
Adtran reported adjusted earnings of 14 cents per share, up from a dime per share in the year-ago period and 6 cents better than the consensus estimate. Revenues of $142.2 million just cleared Wall Street’s bar of $141.07 million.
CEO Tom Stanton said that ADTN’s recent results exceeded expectations thanks to higher sales in both its products and services businesses.
Adtran shares were up some 6% in Tuesday’s pre-market trade.
As of this writing, Karl Utermohlen did not hold a position in any of the aforementioned securities.
