Stocks are finishing the week with a muted opening as VF Corp. and Skechers disappoint investors with their earnings.
The S&P 500 is flat at 2,164, the Dow Jones Industrial average is lower by 3 points to 18,513 and the Nasdaq is also starting out flat at 5,073. The S&P Retail ETF is dropping by 4 cents to $44.25.
VF Corp.’s stock fell 1 percent to $62.41 as the apparel company beat analysts’ estimates, but missed on revenues and lowered the 2016 sales outlook. VF Corp delivered adjusted earnings per share of 35 cents, which topped the FactSet estimate of 34 cents. Revenue increased 1 percent to $2.4 billion, but this was 3.9 percent lower than the FactSet estimate for $2.5 billion. Vans sneakers sales jumped 4 percent and The North Face revenue rose 2 percent. Jeanswear revenue also rose 3 percent, but Timberland fell 7 percent. VF Corp. also trimmed its revenue outlook for the rest of the year from mid-single-digits to a range of 3 to 4 percent.
Skechers USA Inc. is plunging more than 19 percent to $25.81 after the footwear company missed earnings and revenue estimates for the second quarter. Net income for the quarter was $74.1 million, or 48 cents a diluted share, down from $79.8 million, or 52 cents, a year ago. This missed the Capital IQ estimate for earnings per share of 52 cents per share. Net sales for the three months ended June 30 were $877.8 million, a big jump over last year’s $800.5 million, but also missing the Capital IQ estimate for $888 million. The company noted that the sales figure was a new record. Skechers also said on its conference call that it was cautious about the domestic market and a surplus of promotionally priced footwear.
PayPal Holdings Inc. stock is down by over 8 percent to $36.78 after delivering its earnings following the market close on Thursday. The online payment company reported earnings of 36 cents per share in line with the FactSet estimate and revenue of $2.65 billion that topped the FactSet estimate for $2.6 billion. PayPal also raised its full-year guidance to a range of $10.75 billion to $10.85 billion. The shares, though, took a dive after investors expressed display at the news of a partnership with Visa. While it ends a years-long feud, it also means that margins could be pressured as PayPal will likely end up with higher costs.