The major market indices hit fresh all-time highs on Thursday before wavering and shrinking back to fractional gains. Tensions between Saudi Arabia, as well as any lack of clarity following former FBI director James Comey’s testimony, led to mere upticks in the Dow Jones Industrial Average and S&P 500.
To close out the week, two companies — Cloudera Inc (NYSE:CLDR) and Endo International plc (NASDAQ:ENDP) — are making fireworks the wrong way, while DuPont Fabros Technology, Inc. (NYSE:DFT) is making some M&A magic.
Here’s what you should know as we head into Friday’s trading action:
Cloudera Inc (CLDR)
CLDR shares got hammered yesterday evening as the data software company unveiled its quarterly earnings results.
Cloudera bled $5.78 per share in its fiscal first quarter — almost twice as wide as earnings estimates for a $2.45 loss. However, the adjusted figure of 27 cents did beat analysts’ expectations for 36 cents per share.
Revenues were a bit more encouraging. The top line grew 41% year-over-year to $79.6 million, topping analyst expectations of $75.8 billion. That was fueled by 59% growth in Q1 subscription revenues.
The forecast was OK, too. For the full year, Cloudera sees adjusted earnings coming in at -$1.07 to -$1.04, with a midpoint slightly better than analysts’ calls for $1.07 per share. And revenues between $345 million and $350 million are better than the consensus mark of $338.1 million.
All in all, it was a fairly disappointing first effort for the company, which went public in May. And CLDR is down roughly 15% Friday morning, which will roughly halve its post-offering gains.
Endo International plc (ENDP)
ENDP fell sharply on the news that one of its medications will have to be taken off the market.
The Food and Drug Administration is coming down on one of the pharmaceutical’s key drugs in Opana ER, an extended-release opioid that is also known as oxymoprhone hydrochloride.
Opioids are painkillers that continue popping up in the news, with many calling it the country’s greatest drug crisis at the moment, resulting in growing cases of overdoses and deaths every year.
As part of the effort to reduce opioid abuse, the U.S. government has been working toward banning substances that have a higher risk for abuse than the benefits it provides. Opana ER, it would appear by the order, fits the bill.
The FDA sent in a request asking the company to take it down, but the move is simply a formality. The agency has the power to withdraw Opana ER’s approval if Endo International does not comply.
ENDP stock is off 12% ahead of Friday’s opening bell.
DuPont Fabros Technology, Inc. (DFT)
Two of the biggest names in datacenter real estate are joining forces, as Digital Realty Trust, Inc. (NYSE:DLR) is buying out DuPont Fabros Technology.
Digital Realty will purchase DuPont Fabros for $4.95 billion, paid out completely in a stock deal — 0.545 shares of DLR for each share of DFT. That’s a roughly 15% premium from Thursday’s closing price.
With the transaction, Digital Realty will gain access to metro clients in Northern Virginia, Chicago and Silicon Valley, and vastly improve its cloud and cloud-like customer base. Moreover, combined, “investment grade or equivalent customers will represent more than 50% of total revenue.”
The pairing is expected to generate up to $18 million in annualized overhead savings, and create a company with the highest EBITDA margin in the space.
DFT shares are popping about 15% on the news, and DLR shareholders are also cheering the announcement, sending the stock up by about 1%.