U.S. stocks are slightly lower following comments from St. Louis Federal Reserve president James Bullard, who cut his projection for American economic growth. He also suggested that only one rate hike may end up being on the calendar this year.
The S&P 500 is lower by 4 points to trade at 2,073, the Dow Jones Industrial Average fell by 43 points to 17,691 and the Nasdaq was off by 23 points to 4,819. The S&P Retail ETF declined 20 cents to $41.39.
Revlon Inc. stock is moving higher by 4 percent to $32.62 after the beauty company revealed the mass-market beauty company intended to acquire its more prestige leaning rival Elizabeth Arden Inc. for $14 a share, or about $870 million in an all cash deal. Revlon is also willing to pay a premium price to get Arden. Several deals have been happening in the space following Coty’s purchase of the Procter & Gamble beauty portfolio, plus many smaller independent companies getting picked up by The Estée Lauder Cos. Inc. and L’Oréal. Arden stock shot up by 47 percent to trade at $13.77.
Ascena Retail Group Inc. was downgraded to a strong sell by Zacks Investment Research. Zacks cited the company’s disappointing third-quarter results and the continual slide in the share price. Zacks also felt that with the competition in women’s and girl’s apparel, pricing would be under pressure and would force the company to cut prices to keep its market share. Ascena stock is up more than 2 percent to $7.19.
RBC Capital Markets analyst Brian Tunick lowered his estimate and price target for Chico’s FAS Inc. The updated 2016 earnings per share is now 66 cents, a drop from the previous estimate of 82 cents and a penny higher than consensus of 65 cents. The price target was dropped to $13 from $14. The changes were as a result of Tunick’s update of his models to exclude revenues and expenses associated with Boston Proper. He also shifted store and shipping costs to Cost of Goods sold from SG&A. Tunick said he sees 2016 as a reset year for Chico’s. Lately, Chico’s has been under attack from an activist investor, Barrington Capital. The stock was higher by 4 cents to $10.85.