Stocks retreated on Thursday, with the Dow Jones Industrial Average (DJINDICES: ^DJI) ending a nine-day winning streak and the S&P 500 (SNPINDEX: ^GSPC) also closing lower.
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The price of gold had its largest drop in over two months, as the prospect of higher interest rates in response to Fed action made the metal less attractive compared to yield-bearing instruments. The SPDR Gold Shares ETF (NYSEMKT: GLD) fell 0.8%. Bank stocks continued to advance, with the SPDR S&P Regional Banking ETF (NYSEMKT: KRE) rising 0.4%.
As for individual stocks, shares of Anadarko Petroleum (NYSE: APC) jumped following the announcement of a buyback plan, and Scholastic Corporation (NASDAQ: SCHL) tumbled on earnings.
Anadarko announces a buyback plan
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Shares of Anadarko Petroleum rose 8.2% today after the company announced a $2.5 billion stock-repurchase plan. The purchase authorization extends to the end of 2018, and at the share price at the time of the announcement represents 10% of the company's outstanding shares. Anadarko will initially target $1 billion in buybacks in 2017.
The company also reaffirmed guidance given in July that it will achieve average production rates of 130,000 barrels per day from its Gulf of Mexico wells for full-year 2017 and reach a rate of 150,000 barrels a day from its onshore assets in the Delaware and DJ Basins by the end of the year.
"Going forward, we will continue to demonstrate financial discipline with a focus on returns," said Chairman and CEO Al Walker in the press release. "Our 2018 upstream investment plan is anticipated to produce substantial free cash flow, assuming an average oil price of $50 per barrel, while total capital spending, including midstream investments, should be approximately break-even to discretionary cash flow from operations."
This year has not been good to investors in oil exploration and production companies generally, but Anadarko has wrestled with company-specific problems, ranging from four straight quarters of larger-than-expected losses to a tragic home explosion in Colorado that was traced to a leak from an Anadarko-owned gas pipeline. The buybacks are a reversal from just a year ago, when the company issued almost $2 billion of new stock for the purpose of acquiring assets in the Gulf of Mexico, and the market appears to approve of a move in the direction of more financial discipline.
Scholastic Corporation reports a slow quarter
Children's publishing company Scholastic Corporation reported a 33% decline in revenue for its fiscal 2018 first quarter and a non-GAAP loss of $1.67 compared with a loss of $1.15 last year. Shares closed down 7.1%.
The drop-off in business for the company was easily explained, though. Last July the company published Harry Potter and the Cursed Child, Parts One and Two, which turned out to be the best-selling book in North America last year, and caused a doubling of sales in the publishing division in the comparable quarter in 2016. The company reiterated guidance it gave three months ago for full fiscal year revenue down 4% from fiscal 2017 and EPS down 32%.
"As we look forward to our 100th anniversary of producing great content, this summer we began work on our Scholastic 2020 plan, which is designed to grow our operating profits significantly over the next three years," said Chairman and CEO Richard Robinson in the press release.
The year-over-year decline in sales and profit should hardly have been a surprise to the market, but the under-the-radar company is still struggling to match profit levels from earlier years, and plans for a new performance management system and investments in information technology are being met with skepticism until results become more evident.
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