Markets

Consumer Sector Update for 01/22/2015: EBAY,LAS,LE

Top Consumer Stocks

WMT +1.27%

MCD +0.20%

DIS +0.72%

CVS +0.45%

KO +0.58%

Consumer stocks were higher this afternoon, with shares of consumer staples companies in the S&P 500 climbing 0.6%. Shares of consumer discretionary firms in the S&P 500 were gaining over 1.4%.

In company news, online auctioneer eBay ( EBAY ) rose Thursday after announcing a strategic review of its eBay Enterprise unit, including a potential sale or spin-off of the online business-services company through a initial public offering of stock.

The potential spin-off of eBay Enterprise follows the company's September 2014 decision to split off its Pay Pal unit into a stand-alone firm, giving in to pressure earlier last year by activist investor Carl Icahn.

"It has become clear that [eBay Enterprise] has limited synergies with either business," CEO John Donahoe said in prepared remarks, adding its separation from Pay Pal and the parent company would "allow both to focus exclusively on their core markets."

In a related move last night, EBAY said it reached a standstill agreement with Icahn, naming Jonathan Christodoro from Icahn Capital to a newly created seat on the company's board of directors.

The company late Wednesday also disclosed plans to reduce its global workforce by roughly 7%, laying off around 2,400 employees. The job cuts follow a subpar forecast by EBAY for its current quarter heading in March, expecting earnings trailing the Capital IQ consensus by at least $0.05 per share and revenue coming in at least $250 million below analyst estimates.

EBAY shares were ahead more than 6% at $56.78 each, easing slightly from their session high at $57.23 a share. The stock has traded within a 52-week range of $46.34 to $59.70 a share, slipping less than 2% over the past year prior to Thursday's gain.

In other sector news,

(+) LAS, (+14.5%) Board Chairman Hetong Guo, CEO Jing Yang and other senior managers announce plans to buy up to $1 mln of the auto-dealer's American depository shares as soon as possible within the next month.

(-) LE, (-20.5%) Expects to report Q4 EPS of $1.06 to $1.16 per share, lagging Street view by at least $0.22 per share. Revenue is projected in a range of $505 mln to $515 mln, also missing the Capital IQ consensus by at least $27.21 mln.

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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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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