Consumer Sector Update for 06/21/2018: NKE,KR,DRI,THO

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Top Consumer Stocks

WMT +0.74%

MCD -1.22%

DIS -1.11%

CVS -0.75%

KO -0.53%

Consumer stocks have turned broadly mixed this afternoon, with shares of consumer staples companies in the S&P 500 climbing more than 0.1% in late trade while shares of consumer discretionary firms in the S&P 500 were declining over 0.6%.

Among consumer stocks moving on news:

- Nike ( NKE ) has reduced some of its prior decline, paring a nearly 2% slide by roughly half, after analysts at Robert W. Baird & Co. raised their price target for the athletic wear company by $4 to $82 a share, also reiterating their Outperform stock rating. The move worked to offset the impact of a downgrade of Nike stock earlier Thursday at UBS, which trimmed its investment recommendation to Neutral from Buy. In a new research note to clients, Baird analyst Jonathan Komp said he expects North American revenue and gross margins at Nike to inflect positively, adding the stock would move higher as long as a fundamental acceleration is in play for 2019 and beyond.

In other sector news:

+ Kroger ( KR ) shares surged Thursday, topping out with a nearly 13% gain, after the grocery chain reported adjusted Q1 net income and revenue exceeding Wall Street expectations and also raised the bottom of its FY18 earnings outlook. Excluding one-time items, Kroger earned $0.73 per share during the three months ended May 26, up from $0.58 per share during the year-ago quarter and beating the Capital IQ consenus by $0.10 per share. Total sales grew 3.4% year over year to $37.5 billion, also surpassing the $37.25 billion analyst mean. The company is now projecting FY18 net income in a range of $2.00 to $2.15 share, lifting the bottom end of its prior forecast by $0.05 per share and continuing to straddle the Street view expecting a $2.07 per share yearly non-GAAP profit.

+ Darden Restaurants ( DRI ) was extending its earlier gains, climbing almost 13% on Thursday, after the restaurant chain reported adjusted fiscal Q4 net income exceeding analyst projections. Excluding one-time items, Darden earned $1.39 per share during the three months ended May 27, up from $1.18 per share during the prior-year period and topping the Capital IQ consensus by $0.04 per share. Sales rose to $2.13 billion from $1.93 billion last year, matching the analyst mean. For FY19, the company is modelling adjusted earnings of between $5.40 to $5.56 per share and sales growth of 4% to 5%. The Street estimate calls for earnings of $5.42 per share and a 4.6% year over year rise in sales to $8.44 billion.

- Thor Industries ( THO ) was edging lower Thursday afternoon, reversing a 4% gain soon after the opening bell that followed the recreational vehicle company authorizing a new $250 million stock buyback program over the next two year. The company also said it has repaid all of the outstanding balance on its revolving credit facility formed after Thor's June 2016 acquisition of Jayco.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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This article appears in: Business , Commodities
Referenced Symbols: NKE , KR , DRI , THO

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