Markets were falling slightly after news was released that Visa (V) had cut their revenue forecasts for the year. The company reported that their expectations for the year were slashed due to cross-border growth transactions slowing down as the U.S. dollar strengthened. Visa retains over 60% of its transaction volume outside of the United States. The company said growth forecast for the year were now sitting between 9% and 10%. This was down from the previous projections between 10% and 11%. In the latest quarter, Visa’s revenue was up less than a percent to $854 million. Gil Luria, an analyst with Wedbush Securities Inc., said, “Service revenue and processing revenue growth was adequate. It’s more the international revenue, the cross border transaction, that took a step down this quarter.”
Shares of Starbucks (SBUX) were on the rise after the company announced an increase in sales for the latest quarter. They are partially attributing the rise in sales to there most recently revamped breakfast sandwiches and other new food menu items. Starbucks CEO, Howard Schultz, said, “Food at Starbucks, I think we can all admit, for many, many years was a weakness and a challenge for us.” The coffee giant announced they had a 7% increase in their flagship U.S. market and sales increased worldwide. For the most recent quarter Starbucks reported earnings of $512.6 million, or 67 cents per share, slightly above the 66 cents analysts were expecting. This also surpassed the $417.8 million, or 55 cents per share at this time last year. Revenue was up to $4.15 billion, also above the $4.14 billion that analysts were expecting. The company also announced that they have increased earnings projections for the year to $2.70 to $2.72 per share. This is up from the previous estimate of $2.62 to $2.68 per share.
Shares of McDonald’s (MCD) were sinking as the company reported they were switching up their menu due to the recent meat scandal in China. The company announced that they have suspended sales of chicken nuggets and other items in Hong Kong after the company said that they had imported certain products from Shanghai Husi Food. The company is in the hot seat right now due a food safety scare. McDonalds confirmed that between July of last year and June of this year they had purchased food items from the company but currently have no food items in stock from Husi Food. McDonalds said, “We reiterate that until today, all the food sold at McDonald’s restaurants conform to the food safety standard under Hong Kong legal regulations.”
That’s all for today,
Warren Gates, Normandy Research