Consumer Sector Update for 04/08/2016: SALE,DLTH,RT

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Consumer stocks were mixed, with shares of consumer staples companies in the S&P 500 dropping 0.3% while shares of consumer discretionary firms in the S&P 500 were rising about 0.3%.

In company news, RetailMeNot ( SALE ) advanced Friday after the online marketplace raised its Q1 sales outlook above analyst estimates and boosted its revenue forecast for the rest of 2016.

Projected revenue for the three months ended March 31 is now seen in a range of $54 million to $54.5 million, the company said, up from a prior forecast between $49 million to $54 million and exceeding the Capital IQ consensus by at least $1.63 million.

It also raised its FY16 sales guidance to $228 million to $241 million compared with its former outlook expecting $225 million to $240 million and continuing to bridge the $233.91 million Street view.

The company last night also announced it purchased GiftCard Zen, a secondary marketplace for gift cards, for $22 million in cash plus up to $11 million in deferred compensation tied to specific performance targets. The deal initially is expected to reduce RetailMeNot's adjusted earnings before interest, taxes, depreciation and amortization by around $2 million during the first year after closing before starting to generate positive operating income on a monthly basis by the end of 2017.

SALE shares were up almost 11% at $8.31 apiece, easing slightly from a session high of $8.54 a share.

In other sector news,

(+) DLTH, (+21.9%) Adjusted Q4 EPS of $0.37 beat Street view by $0.06 per share. Revenue rises 27.5% over year-ago levels to $140.4 mln, topping the $133.52 mln consensus. Sees FY17 GAAP EPS of $0.66 to $0.70, beating estimates by at least $0.01 per share. Projected revenue also exceeds analyst mean.

(-) RT, (-14.6%) Q3 EPS of $0.03 per share misses by $0.02 per share. Revenue falls 5.0% to $271.5 mln, $284.14 mln consensus. Sees sales at locations open at least a year falling 1% during FY16. CFO Jill Golder quits for senior position at another company.

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

Copyright (C) 2016 All rights reserved. Unauthorized reproduction is strictly prohibited.

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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