Despite the bearish start to the new trading week, the bulls did a pretty good job of fighting their way back. The S&P 500’s close of 2,469.91 was still 0.11% lower than Friday’s last trade, but it could have been worse in light of a handful of poor earnings reports, warnings and lackluster outlooks unveiled today.
Here’s the deal.
Hasbro, Inc. (HAS)
Whether toymaker Hasbro had a good second quarter is largely a matter of perspective. It was a good quarter in the sense that the company topped its per-share profit expectations, but disappointing in the sense that sales just barely cleared the bar (and didn’t clear everyone’s bar). The 9.4% setback HAS shares suffered on Monday, though, says traders saw the results as a glass half-empty.
For the quarter ending in June, Hasbro turned revenue of $972.5 million into earnings of 53 cents per share. The bottom line was up from year-ago levels of 41 cents per share of HAS, and better than expectations of 45 cents. Sales were also well up from $878.9 million a year earlier. The FactSet consensus top line was $972.5 million, which is still a beat, but the smallest revenue beat in a year and a half.
HAS shares were up more than 40% year-to-date largely in anticipation of strong sales of movie tie-in toys, but its partner-branded revenue was only up 1% while its emerging-brand lines saw a 14% dip in revenue.
Halliburton Company (HAL)
Much like Hasbro, oilfield service giant managed to top its second-quarter earnings and revenue expectations, but saw its stock slide lower all the same.
Last quarter, Halliburton earned 23 cents per share on revenue of $4.96 billion. Both compared favorably to the year-earlier bottom line of 14 cents and sales of $3.84 billion, and both were better than the top line of $4.86 billion and earnings of 18 cents per share of HAL the pros were modeling.
Halliburton’s executive chairman Dave Lesar sees a headwind brewing though, commenting of the Q2 results, “Today, rig count growth is showing signs of plateauing, and customers are tapping the brakes. This tapping of the brakes is happening all over the place in North America.” That was enough to sand HAL shares to a loss of 4.2% for the session.
Hibbett Sports, Inc. (HIBB)
Last but not least, Hibbett Sports shares plunged a whopping 33.5% after the retailer delivered a dire profit warning to HIBB shareholders. That is, it anticipates reporting negative same-store sales of 10% when it reports its official Q2 numbers next month for the quarter ending this month.
Hibbett’s top line has been growing at a slowing pace for years, and its bottom line has been shrinking since 2015. The scope of the headwind only became painfully clear this morning though, when the company dropped the bomb.
Hibbett Sports also announced it had finally launched an e-commerce venue, but as Quo Vadis Capital President John Zolidis responded, “Hibbett punctuated just how woefully late it is to offering e-commerce by announcing the final launch of this capability in the same press release today with the terrible news on sales and earnings. … The timing could not be more apropos.”
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.