Angie’s List Swipes Left on IAC; Homerun Earnings for Home Depot; Dick’s Sporting Goods on a Losing Streak

Nobody puts Angie’s List in a corner…

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Image courtesy of suphakit73/FreeDigitalPhotos.net

If boardroom walls could talk, I wonder what they would say about Angie’s List putting the kibosh on Barry Diller’s IAC proposal to buy the home services directory. IAC offered up $8.75 a share, totaling $512 million, to add Angie’s List to its growing portfolio of online companies. IAC argues that its offer – which was unsolicited, btw – is a 50% premium on Angie’s List share price. However, Angie’s List begs to differ and says that the  unsolicited proposal, was a paltry 10% premium on its share price. So what gives? Well, that depends on which day we are discussing, I suppose. One month before IAC’s unsolicited offer, shares of Angie’s List closed at $5.78. In which case the $512 million offer would indeed represent a 50% premium on the share price. However, shares of Angie’s List closed at $7.84 on November 10, which means that a $512 million offer would then represent a paltry 10% premium. In any case, the deal’s not going to happen for several reasons and one of them, as Angie’s List CEO Scott Durchlag explains, is because the benefits are one-sided. And not the side Angie’s List is on. His board of directors unanimously agreed with him. IAC already owns Angie’s List competitor Home Advisor and last week picked up Tinder, together with its parent company, Match Group.

If you build it, they will come…

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Image courtesy of Idea go/FreeDigitalPhotos.net

According to the National Association of Home Builders, sentiments are not just up, they are at record highs. Those sentiments are all part of the the joy we call a housing recovery which is extremely good news. Especially for Home Depot, who just announced its earnings much to the fiscal glee of investors. The company announced better than expected sales and even expects its full-year earnings to fall at the top end of its forecasts at around $15.36. Which is especially awesome since so many companies lately have been reducing their’s (see below). Not only did shares of the home improvement chain rise today, but its shares are up 15% for the year too. Sales at Home Depot rose 6.4% coming at $21.82 billion, missing predictions by a $10 million smidgeon. But does that really matter when profits rose 12%, hitting $1.73 billion and adding $1.36 per share? Well…it’s not my place to say. But still, analysts only expected $1.32. You see, it all evens out in the end. Sort of. Even online sales are up  25%, though they only account for 5% of all sales. But hey, money is money.  Apparently these great earnings are courtesy of builders and amateurs alike, who are scrambling to Home Depot stores lately given the rise in housing turnover, with prices of homes on the rise. That may not bode well if you’re in the market for a new place to rest your head, but if you’re selling, this could be your lucky quarter.

Striking out…

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Image courtesy of Idea go/FreeDigitalPhotos.net

You know whose shares aren’t up? Dick’s Sporting Goods. In fact, its shares have hit a four year low and are down about 18% for the year. To make matter worse, the company has had to reduce its full-year earnings forecast. Nothing says fiscal disaster quite like reducing forecasts. Now, instead of hoping to add between  $3.13 – $3.21 per share, the company is hoping (and praying, no doubt) that it pulls down $2.85 – $3.00 per share. Even analysts had initially expected that company to earn $3.18 per share for the year. And what or whom, you might be wondering, is Dick’s Sporting Goods blaming – other than itself –  for their abysmal earnings? If you guessed mother nature and her unusually warm autumn , then you are absolutely correct. Apparently, Dick’s seasonal items didn’t fly of the shelves as hoped, just like at Macy’s and other retailers, since the weather was warmer and consumers didn’t feel compelled to get toasty. Incidentally, Dick’s clothing and shoes fared a bit better with sales creeping up 0.4%. Hey, Dick’s will take what it can get. But the company did admit to having too much inventory – 13% more than last year – and are looking to get rid of it. Good luck with that. Dick’s pulled down $1.64 billion in revenue  when analysts predicted numbers closer to $1.67 billion. The company also scored a profit of $4.72 million, adding 45 cent per share, which was a 4% drop over this time last year. Analysts, by the way, would have preferred to see another penny added to those shares. Oh well.

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