LOCAL BUSINESS
Insurer gets credit line
Richfield-based specialty insurer National Interstate Corp. says it has a new $100 million, five-year unsecured credit agreement with Fifth Third Bank. The new line of credit replaces a $50 million credit facility and could be increased to $125 million, the company said.
The line of credit can be used for general corporate purposes, including acquisitions and working capital.
“This new line of credit will provide us with a significant source of backup liquidity, further bolstering our strong balance sheet,” Julie McGraw, vice president and chief financial officer, said in a statement.
EARNINGS
Lowe’s profits up
Lowe’s Cos. said its third-quarter net income surged 76 percent, helped by lower costs and higher revenue, as the company’s efforts to revamp its merchandise and prices appeared to be gaining traction.
Lowe’s has been retooling its pricing strategy, and last summer returned to offering permanent low prices on many items across the store, instead of offering fleeting discounts. But the changes have been slow to catch on, and last quarter Lowe’s said it could take until the middle of next year to reap the benefits of the strategy.
Lowe’s earned $396 million, or 35 cents per share, for the three months ended Nov. 2. That compares with $225 million, or 18 cents per share, a year ago.
The current quarter includes charges that lowered earnings by 5 cents per share. In the prior-year period, charges reduced earnings by 18 cents per share.
The adjusted earnings of 40 cents per share beat the 36 cents per share that analysts polled by FactSet predicted.
Revenue rose 2 percent to $12.07 billion from $11.85 billion. That also beat Wall Street’s estimate of $11.93 billion.
RETAIL
Wal-Mart workers rally
Wal-Mart Stores Inc. workers demanding better pay and benefits vow to mount 1,000 protests online and outside stores up to and including Black Friday. The strategy risks showing the company’s strength, not vulnerability.
To work, the approach will require protest leaders to turn out significant numbers of strikers and persuade deal-chasing shoppers to go elsewhere. Similar protests in recent weeks have had little perceptible impact on the world’s largest retailer.
The United Food & Commercial Workers union has tried and failed to organize Wal-Mart workers. In recent months, the union has adopted a new tactic: backing two groups, OUR Walmart and Making Change at Walmart, and waging a media campaign and mounting protests comprising activists and Wal-Mart workers at stores and warehouses around the U.S.
LEGAL
Mediation at Hostess
Hostess Brands Inc. and its second largest union agreed to go into mediation to try to resolve their differences. That means the maker of the spongy Twinkie cake with the mysterious cream in the middle won’t go out of business yet.
The maker of Ho Ho’s, Ding Dongs and Wonder Bread last week moved to liquidate and sell off its assets in bankruptcy court. The company cited a strike started on Nov. 9 by the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, which represents about 30 percent of Hostess workers.
WALL STREET
Dow rises 207 points
The stock market finally shook its post-election slump.
Investors seized on hope that Washington will reach a deal on the federal budget and drove stocks to their biggest gain in two months. A pair of strong corporate earnings reports also helped.
The Dow Jones industrial average closed up 207.65 points, or 1.7 percent, to 12,795.96. The Standard & Poor’s 500 index rose 27.01 points, or 2 percent, to 1,386.89. The Nasdaq composite average gained 62.94, or 2.2 percent, to 2,916.07.
The S&P 500 and Nasdaq were lifted by Apple, which had its biggest one-day gain since April. It rose $38.05, or 7.2 percent, to $565.73. Some analysts cast doubt on a sell-off that had pushed the stock down more than 20 percent from its recent peak.
The S&P 500, meanwhile, is trading near a key technical level, said Randy Frederick, managing director of active trading and derivatives at the brokerage Charles Schwab.
For nearly two weeks, the index has closed below its 200-day average, which on Monday stood at 1,382. It surpassed that marker Monday afternoon. Frederick said that might signal more buying.
Technical levels are historic averages and other indicators used by some traders to decide if stocks are a good value.
The market is closed on Thursday for Thanksgiving and will close early Friday.
Compiled from staff and wire reports