Editor’s Note: This is the Paw Print Rewind, a daily recap of the top news headlines.
Lowe’s gains overshadowed by Home Depot
Lowe’s fourth-quarter sales at U.S. stores open for over a year rose a healthy 5.5 percent, with expectations for 2016 sales to rise six percent.
“As good as (Lowe’s) numbers are, comparisons will inevitably be drawn with Home Depot’s much stronger results. This takes the shine off (Lowe’s) figures as it indicates that Home Depot is adding market share at a faster pace that Lowe’s.”
-Hakon Helgesen, Conlumino analyst
Overall, the Mooresville, NC-based company’s same-store sales rose 5.2 percent in the quarter ending Jan. 29.
Lowe’s net earnings plunged to $11 million from $450 million, hurt by a $530 million impairment charge related to leaving a joint venture in Australia.
Excluding items, the company earned $0.59/share.
Net sales rose 5.6 percent to $13.24 billion.
Telescope used on Armstrong’s moon landing finds new galaxies
The Parkes telescope, used to broadcast live vision of Neil Armstrong’s first steps on the moon in 1969, has found 883 new galaxies hidden behind the Milky Way by using an innovative receiver measuring radio waves.
The telescope’s findings were reported in the latest issue of Astronomical Journal.
“Hundreds of new galaxies were discovered, using the same telescope that was used to broadcast the TV pictures from Apollo 11. The electronic technology at the back end is substantially different and that is why we can still keep using these old telescopes.”
-Lister Staveley-Smith, University of Western Australia International Center for Radio Astronomy Research professor
The discoveries occurred as scientists were investigating the region’s close proximity to the Great Attractor, a gravity anomaly in intergalactic space.
According to the study, using radio waves has allowed scientists to see beyond dust and stars in the Milky Way that previously blocked the view of telescopes.
According to Staveley-Smith, scientists have been trying to get to the bottom of the mysterious Great Attractor since major deviations from universal expansion were first discovered in the 1970s and 1980s.
“It’s a missing part of the jigsaw puzzle, which is the structure of our local universe. They have managed to pierce through it and complete the picture of what our part of the universe looks like.”
-Michael Burton, University of New South Wales Physics School professor
Target comp sales show turnaround traction
Target’s comparable sales in higher-margin categories rose by over three times the company average in the quarter ending Jan. 30, with women’s apparel, wearable electronics, and food being the fastest growing.
“Signs that CEO Cornell’s strategic initiatives are gaining traction include: ‘signature’ categories re-accelerating to about six percent growth and traffic rising 1.3 percent.”
-Renato Basanta, Sterne Agee analyst
According to Target finance chief Cathy Smith, apparel sales were helped by better in-store and online presentation and the stocking of trendier styles.
“We believe that Target performed somewhat above the market (in apparel) thanks to its more fashion-savvy shopper demographic and its strong marketing efforts around holiday looks.”
-Neil Saunders, Conlumino CEO
Best Buy forecast misses expectations
Best Buy forecast revenue between $8.25-$8.35 billion and a profit of $0.31-$0.35/share for the first quarter.
The Richfield, MN-based company will buy back up to $1 billion in shares over the next two years, along with a special $0.45/share dividend.
According to company CFO Sharon McCollam, Best Buy expects revenue declines in the first half of the year, followed by second half growth.
“In this context, we are targeting flat domestic (U.S.) revenue for the full year … but recognize that it will be challenging without a strong mobile cycle.”
-Sharon McCollam, Best Buy CFO
Sales at established stores fell 1.7 percent in the first quarter, while sales of computing and mobile devices fell 6.8 percent in the United States. The category accounts for 43 percent of the company’s total U.S. revenue.
The company’s net income fell 7.7 percent to $479 million ($1.40/share) in the quarter that ended Jan. 30.
Excluding items, Best Buy earned $1.53/share from continuing operations.
Revenue fell 4.1 percent to $13.62 billion.
Dynegy, Energy Capital to buy Engie’s U.S. power plants
Dynegy and Energy Capital will buy Engie’s U.S. power plants, as falling demand for electricity in the United States has led to a spike in utility mergers.
The deal gives Dynegy access to the Texas market, which is currently controlled by grid operator Electric Reliability Council of Texas.
According to Dynegy, the deal will also boost the Houston-based company’s presence in New England, the mid-Atlantic, and parts of the Midwest.
According to Dynegy, the acquisition would add about 8,731 megawatts to its generation capacity.
Dynegy will invest about $770 million, while Energy Capital will invest about $415 million in the joint venture.
According to Dynegy, the partnership has secured financing with $2.25 billion in committed debt facilities and $1.19 billion in equity commitments. Energy Capital will also buy $150 million of Dynegy stock at $10.94/share, raising its holding in the company to about 15 percent.
Energy Capital will have the right to exit the joint venture four years after the deal closes, either through a sales of its interest to Dynegy or a sale of the entire joint venture.
Hasbro looks to girls for turnaround
Hasbro is turning to Disney princesses and its first animated movie to turnaround a five-quarter slump in its girls’ toy sales.
The Pawtucket, RI-based company has begun selling dolls from Disney movies Frozen and Cinderella after getting the license from Mattel. According to company CEO Brian Goldner, Hasbro will also launch My Little Pony toys throughout the year ahead of its 2017 movie release.
“Getting it on the shelves early allows Hasbro to maximize the window in which it can sell.”
“These products are already on shelves in the U.S. and rolling out internationally. Shipments are now ramping up and early consumer indications are positive.”
-Brian Goldner, Hasbro CEO
Hugo Boss CEO steps down after weak China, U.S. sales
Hugo Boss CEO Claus-Dietrich Lahrs is stepping down after eight years with the German fashion house after weak sales in China and the United States.
According to the Metzingen, Germany-based company, Hugo Boss will start without delay to find a successor to Lahrs, who was leaving with effect of Feb. 29 “upon his request as part of a mutual agreement.”
Laurs joined Boss in 2008.
According to the company, Bernd Hake will take responsibility for sales and retail as a new managing board member starting March 1. Lahrs’ other responsibilities will be taken on by other board members until a successor is found.
McDonald’s launching in Kazakhstan next month
McDonald’s will open its first restaurant in Kazakhstan in March, with another 15 opening afterwards.
According to McDonald’s Russia president Khamzat Khasbulatov, the restaurant will launch in Kazakh capital Astana on March 8 after $3.5 million of franchise project investments.
Halliburton slashing another 5,000 jobs
According to company spokesperson Emily Mir, Halliburton is slashing another 5,000 jobs, or roughly eight percent of its workforce.