Morgan Stanley Expects Foot Locker to Beat on Earnings
Morgan Stanley seems to have conflicted feelings about Foot Locker Inc. (FL) ahead of its earnings release.
Analysts at the firm expect Foot Locker to report earnings of 72 cents a share on Friday, August 24, slightly ahead of Wall Street's consensus estimate of 70 cents. However, the firm's expected same-store sales growth of 0.6% is lower than Wall Street's 0.8% expectation.
Morgan Stanley maintained its "underweight" rating and $44 price target, a 14% downside from the stock's opening price Monday.
"We remain confident in our long-term Underweight thesis, given our work that indicates NKE's DTC (direct to consumer) growth poses a significant threat to FL's top line," analyst Lauren Cassel wrote. "NKE is increasingly focused on its direct-to-consumer strategy, particularly online, and our analysis suggests 46% of Nike.com SKUs are not available on FootLocker.com."
Nike Inc. (NKE) has made no secret of its intentions to lean heavily on its direct-to-consumer business in the future as a way to grow revenue and Morgan Stanley believes that this will "reduce the amount of 'unique' product sold into Foot Locker over time."
Walmart Signs Deal With Anthem to Expand OTC Drug Access
Walmart (WMT) has partnered with health insurer Anthem (ANTM) to provide expanded availability to over the counter drugs to seniors.
Starting in January, seniors enrolled in Anthem's Medicare Advantage plans will be able to use their insurance to purchase over the counter drugs.
"We believe that programs like this can make a tremendous difference for health-care consumers who often live on a fixed income or are managing chronic medical conditions," said Felicia Norwood, executive vice president and president of Anthem's government business division, according to CNBC.
Tesla Could Have $25,000 Vehicle in 3 Years, Musk Says
Tesla Inc. (TSLA) shares are falling more than 3% Monday as investors ignore CEO Elon Musk's latest claims about the company's future.
Musk told tech YouTuber Marques Brownlee that Tesla could build a $25,000 car in the next three years "if we work really hard."
Currently, Tesla's Model 3 is the cheapest offering at $35,000 and the company is pinning its hopes of mass market penetration on that vehicle.
However, Tesla is also currently under investigation by the SEC over tweets Musk sent two weeks ago about plans for the company to potentially go private.
PepsiCo to Purchase SodaStream for $3.2 Billion
Shares of SodaStream (SODA) are up 10.17% premarket Monday after consumer food brands company PepsiCo (PEP) announced plans to purchase the company for $3.2 billion.
Pepsi will pay $144 per share for the company, a 32% premium over the stock's 30-day trading average.
SodaStream allows customers to make carbonated beverages at home using refillable cylinders. It is sold in 80,000 individual retail stores in 45 countries with Germany, France, Canada and the U.S. being its biggest markets.
U.S. futures were climbing ahead of Monday's market open as markets look to build momentum on last week's close.
Dow futures were climbing 0.16%, indicating an open 41 points higher, while S&P futures were rising 0.12%, indicating an open 4 points higher, while Nasdaq futures rose 0.24%, indicating an open 18 points higher.
World markets were also mostly higher. In Asia, the Nikkei was the lone market to trade in the red, falling 0.32%, while the Hang Seng rose 1.41% and the Shanghai Composite gained 1.11%.
European markets were gaining also with the CAC 40 climbing 0.6%, the DAX rising 0.93%, and the FTSE 100 rose 0.34% with about four hours left in trading.