Stocks rose on generally positive earnings reports Monday. The Dow Jones Industrial Average (DJINDICES: ^DJI) and the S&P 500 (SNPINDEX: ^GSPC) finished with modest gains.
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Consumer stocks led the market; the Consumer Discretionary Select SPDR ETF (NYSEMKT: XLY) closed up 0.7%. Gold continued its recent slide, causing the VanEck Vectors Gold Miners ETF (NYSEMKT: GDX) to fall 1.2%.
As for individual stocks, SeaWorld Entertainment (NYSE: SEAS) reported higher attendance and in-park spending, and Newell Brands (NYSE: NWL) continues to struggle with turnaround efforts.
SeaWorld soars on attendance growth
Theme park operator SeaWorld Entertainment reported better-than-expected revenue driven by attendance gains at its properties, and shares popped 16.9%. Revenue increased 4.9% to $391.1 million, while analysts were expecting $371 million. Earnings per share came in at $0.26, $0.01 less than the analyst consensus, but that figure includes $8.7 million of pre-tax expenses due separation-related costs and a legal settlement.
Attendance increased 4.8% despite some significant headwinds in the quarter. Bad weather affected attendance at some of the parks, and an earlier Easter moved some spring-break traffic into the first quarter. For the first half, attendance grew 8% over the same period last year. Admission per capita fell 4.2% due to new pricing strategies, but the higher number of guests attracted by those deals spent more once in the park; in-park per capita spending increased 6.5%.
"As we enter the last few weeks of our peak summer season, we are encouraged that year-to-date results through July for attendance, season pass sales and total revenue have remained strong," interim CEO John Reilly said in the press release. "We are seeing growth in attendance and revenue as a result of our new pricing strategies, enhanced communications activities and strong operational execution."
The strong results and positive comments about the momentum of its business had the stock hitting 52-week highs today.
Newell Brands reports falling sales
Shares of consumer goods specialist Newell Brands tumbled 14.3% after the company reported a decline in sales and profit and lowered guidance. Net sales from continuing operations fell 12.8% to $2.2 billion and earnings per share fell 41.3% to $0.27. "Normalized" -- or non- GAAP -- earnings per share fell 5.8% to $0.82.
Core sales -- which Newell defines as sales excluding the impact of foreign currency, acquisitions until their first anniversary, and completed divestitures -- declined 6.2% from the period a year earlier. Operating cash flow was $11.2 million, compared with $56.8 million in Q2 last year.
Looking forward, Newell lowered its sales forecast for the full year from $14.4 bilion-$14.8 billion to $8.7 billion-$9.0 billion, mainly due to divestitures. The outlook for 2018 normalized EPS was lowered $0.20 to a range of $2.45 to $2.65. The forecast for operating cash flow for the year was lowered $250 million to $0.9 billion to $1.2 billion. The company expects core sales growth to to be "down low single digits percent" in Q3 and then "up low single digits percent" in Q4.
"While the retail landscape remains difficult, consumer macros are generally good and we expect core sales on our continuing businesses to recover to growth by the fourth quarter, with margins improving as a result of strong savings programs and broad-based price increases," said CEO Michael Polk.
Newell is attempting to recover from a failed merger by shedding its weakest brands, but this quarter's report did little to reassure investors of its progress.
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