Top 10 News Items 12/20-12/23: Jo-Ann Stores Becomes Next PE Target; Economic Data Points Mixed; Q3 GDP Revised to 2.6%
Here is a recap of the top news items from this week on Wall Street:
1. Shares of Jo-Ann Stores (NYSE: JAS) rallied more than 32% on Thursday as private-equity firm Leonard Green & Partners offered to buyout the company in a $1.6 billion deal. The deal values shares of Jo-Ann at $61 each, representing a 34% premium from the closing price on Wednesday.
2. Economic data was mixed this week; personal spending for the month of November came in at 0.4%, slightly worse than the 0.5% the Street had been looking for, while personal income of 0.3% was modestly better than the Street's 0.2% estimate. Both numbers were below the levels posted during October.
3. The final revision to the Q3 GDP number came in at 2.6% this week, slightly lower than the 2.8% revision the Street had been looking for. Compared to the first revision to the data point, the latest GDP reading was up 0.1%.
4. Initial jobless claims for last week were flat at 420,000, while continuing claims came in lower than the prior week reading, and better than economists had been looking for. The latest week's continuing claims reading came in at 4.064 million.
5. New home sales for November were slightly worse-than-expected at 290,000. The Street had been looking for 300,000. Last month's figure was up 5.5% on a month-over-month basis, which compares to a downwardly-revised 10.7% drop in the October new home sales reading.
6. Toronto-Dominion Bank (NYSE: TD) acquired Chrysler Financial from Cerberus for $6.3 billion this week. TD, the second largest bank in Canada, said the purchase will consist of net assets of $5.9 billion and roughly $400 million in goodwill. Shares of TD rose 3.5% on Tuesday following the news.
7. Elsewhere on the M&A front, Martek Biosciences (Nasdaq: MATK) will be acquired by DSM for $1.1 billion, Raytheon (NYSE: RTN) bought Applied Signal (Nasdaq: APSG) for $490 million, and Sonic Solutions (Nasdaq: SNIC) announced a deal with Rovi (Nasdaq: ROVI) for $14.17/share.
8. Nike (NYSE: NKE) shares fell almost 6% on Wednesday following Q2 earnings. The company posted quarterly EPS of 94 cents, beating the Street by 7 cents, on sales of $4.84 billion. Inventories at Nike rose 8% on a year-over-year basis.
9. On Monday Adobe (Nasdaq: ADBE) reported Q4 EPS of 56 cents on sales of $1.01 billion, both measures better-than-expected versus the analyst consensus. The company also offered strong guidance, saying it expects Q1 sales in the range of $1-$1.05 billion with EPS of 54-59c. Shares rallied about 6% on the solid numbers.
10. Crude oil pushed to 2-year highs this week, as global pressure on currencies (certainly the US dollar) becomes a perfect example of "a rising tide lifts all boats." Recent large draws on crude oil inventories has caused commodities traders to push prices higher and higher. A barrel of crude oil closed this week's holiday-shortened session at $91.45.
1. Shares of Jo-Ann Stores (NYSE: JAS) rallied more than 32% on Thursday as private-equity firm Leonard Green & Partners offered to buyout the company in a $1.6 billion deal. The deal values shares of Jo-Ann at $61 each, representing a 34% premium from the closing price on Wednesday.
2. Economic data was mixed this week; personal spending for the month of November came in at 0.4%, slightly worse than the 0.5% the Street had been looking for, while personal income of 0.3% was modestly better than the Street's 0.2% estimate. Both numbers were below the levels posted during October.
3. The final revision to the Q3 GDP number came in at 2.6% this week, slightly lower than the 2.8% revision the Street had been looking for. Compared to the first revision to the data point, the latest GDP reading was up 0.1%.
4. Initial jobless claims for last week were flat at 420,000, while continuing claims came in lower than the prior week reading, and better than economists had been looking for. The latest week's continuing claims reading came in at 4.064 million.
5. New home sales for November were slightly worse-than-expected at 290,000. The Street had been looking for 300,000. Last month's figure was up 5.5% on a month-over-month basis, which compares to a downwardly-revised 10.7% drop in the October new home sales reading.
6. Toronto-Dominion Bank (NYSE: TD) acquired Chrysler Financial from Cerberus for $6.3 billion this week. TD, the second largest bank in Canada, said the purchase will consist of net assets of $5.9 billion and roughly $400 million in goodwill. Shares of TD rose 3.5% on Tuesday following the news.
7. Elsewhere on the M&A front, Martek Biosciences (Nasdaq: MATK) will be acquired by DSM for $1.1 billion, Raytheon (NYSE: RTN) bought Applied Signal (Nasdaq: APSG) for $490 million, and Sonic Solutions (Nasdaq: SNIC) announced a deal with Rovi (Nasdaq: ROVI) for $14.17/share.
8. Nike (NYSE: NKE) shares fell almost 6% on Wednesday following Q2 earnings. The company posted quarterly EPS of 94 cents, beating the Street by 7 cents, on sales of $4.84 billion. Inventories at Nike rose 8% on a year-over-year basis.
9. On Monday Adobe (Nasdaq: ADBE) reported Q4 EPS of 56 cents on sales of $1.01 billion, both measures better-than-expected versus the analyst consensus. The company also offered strong guidance, saying it expects Q1 sales in the range of $1-$1.05 billion with EPS of 54-59c. Shares rallied about 6% on the solid numbers.
10. Crude oil pushed to 2-year highs this week, as global pressure on currencies (certainly the US dollar) becomes a perfect example of "a rising tide lifts all boats." Recent large draws on crude oil inventories has caused commodities traders to push prices higher and higher. A barrel of crude oil closed this week's holiday-shortened session at $91.45.
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