The “Brexit” continues to be the hot topic of the week, and that’s coming to a boil today now that the June 23 voting date is finally upon us. Pause over the vote weighed on the stock markets Wednesday, as the S&P 500 declined by 0.2%, and the Dow Jones Industrial Average slid by 0.3%.
Earnings reports dominated the news Wednesday, with Barnes & Noble, Inc. (NYSE:BKS), Bed Bath & Beyond Inc. (NASDAQ:BBBY) and Red Hat Inc (NYSE:RHT) all posting results late in the day.
Here’s what to watch for in these three stocks today.
Barnes & Noble, Inc. (BKS)
BKS shares are suffering from a case of whiplash this morning, as it looks like the stock is about to pop after selling off by 7% heading into Wednesday afternoon’s report.
Barnes & Noble just reported fiscal fourth-quarter results, including a big loss of $30.6 million. On an adjusted basis, however, a 24-cent-per-share loss came in line with analyst expectations. Meanwhile, revenues declined 3.7% to $875.7 million, which fell short of estimates for $889 million, on comparable-store sales that declined 0.8%.
Still, investors were a little encouraged by guidance of flat to 1% improvement in comps, as well as EBITDA between $200 million and $250 million, which was slightly better than Street expectations. BKS also plans on opening four concept stores in fiscal 2017.
This morning’s bounceback, currently around 5%, likely also is a result of the heavy selloff heading into the report. The longs certainly should be hoping the rebound sticks, as yesterday’s decline sent shares well below the 200-day moving average, which if sustained, could lead to a significant break lower.
Bed Bath & Beyond (BBBY)
BBBY is off this morning as yet another quarterly report indicates that Bed Bath & Beyond is struggling in its adjustment to get online traction, as well as in keeping its brick-and-mortar sales up.
Bed Bath’s first-quarter sales were flat year-over-year at $2.74 billion, which just missed Wall Street estimates of $2.77 billion. Earnings of 80 cents per share were off 14% and well under expectations of 86 cents.
The company also provided earnings guidance for fiscal 2016, with the company expecting profits between $4.50 and just more than $5 per share.
As a result, Wedbush Securities lowered its price target from $46 per share to $42.
BBBY shares are off 5% Thursday morning.
Red Hat Inc (RHT)
RHT stock is struggling early on after a top-line miss and a bottom-line meet.
Red Hat improved sales by 18% to $567.9 million for its first quarter, falling short of expectations for $563 million. The open-source software provider just managed to hit the 50-cent estimate for adjusted profits.
Projections for Q2 also underwhelmed, with EPS guidance of 54 cents missing by a penny.
Red Hat also used the report to announce the purchase of API management firm 3scale, though few other details were released.
One positive note: The company authorized the repurchase of up to $1 billion in RHT shares.
Still, Red Hat stock was on pace to open Thursday 7% lower.
As of this writing, Karl Utermohlen did not hold a position in any of the aforementioned securities.
