Energy drink maker Monster Beverage was among the top stocks trading on the S&P 500 after the company reported better than expected third-quarter profits.
Monster reported net income of $121.6m, or 70 cents a share, which topped estimates for 66 cents a share. Sales climbed nearly 8 per cent to $635.9m, short of estimates for $642.1m.
The company offered little by way of additional comments on the pending $2.15bn Coca-Cola transaction, which would lead to the drinks giant taking a 17 per cent stake in Monster Beverage, that is expected to close next year.
“Notwithstanding a second consecutive quarter of lower-than-expected sales growth, we expect Monster to maintain its high-single digits top-line growth reflecting rebounding category growth in US . . . solid new product innovation pipeline (eg Ultra Sunrise, Monster Unleaded, new “core Monster”), and solid growth momentum in several international markets,” said Amit Sharma, an analyst at BMO Capital Markets.
Shares in Monster Beverage gained 8 per cent to $108.39 and are up 60 per cent so far this year.
Humana was one of the worst performing stocks on the S&P 500, falling 7 per cent to $130.58, as investors punished the healthcare group for missing earnings and sales expectations in the third quarter.
The company reported net income of $290m or $1.85 a share, on sales of $12.24bn.
This fell short of Wall Street expectations for earnings of $2.01 a share, on sales of $12.36bn. Humana said profits were hit by higher speciality drug costs and bigger investments in healthcare exchanges and state-based contracts.
Same-store sales fell 7 per cent in the US and 15 per cent internationally, as the company continued to struggle to win back teen shoppers. “Although the international stores segment was the most difficult, the lower sales trend was broadly based,” the company said.
The company also expects to report adjusted net income per diluted share in the range 40 to 42 cents a share, below expectations for 68 cents a share.
American Eagle, which also markets to teens, slipped nearly 6 per cent to $12.94.
Zynga reported a net loss of $57.1m, or 6 cents a share, in the three months ended in September, on sales of $176.6m, which were down 12 per cent from a year ago.
Wall Street analysts were looking for a loss of 6 cents a share, on sales of $166.6m.
Bookings, which count sales actually made in the period – considered a more meaningful measure of revenue – increased 15 per cent to $175m, at the high end of its expectations for $165-$175m.
US stocks were relatively unchanged after the October jobs report showed that the US economy had added 214,000 jobs, short of expectations for 235,000 jobs, and the unemployment rate had fell to 5.8 per cent, from 5.9 per cent the previous month.
The S&P 500 was flat at 2,031.92, while the Dow Jones Industrial Average gained 0.1 per cent to 17,573.93. The Nasdaq Composite fell 0.1 per cent to 4,632.53.
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