Stocks wandered sideways on low volume Friday, with the Dow Jones Industrial Average (DJINDICES:^DJI) closing up a point and the S&P 500 (SNPINDEX:^GSPC) falling about a quarter percent.

Today's stock market

Index Percentage Change Point Change
Dow 0.00% 1.11
S&P 500 (0.26%) (7.16)

Data source: Yahoo! Finance.

Industrials were the strongest sector today, with the Industrial Select SPDR ETF (NYSEMKT:XLI) rising 0.6%. Financials were a drag on the market as long-term rates slipped back after recent gains; the Financial Select Sector SPDR ETF (NYSEMKT:XLF) dropped 0.8%.

As for individual stocks, Campbell Soup Company (NYSE:CPB) served up a steaming bowl of bad news for its shareholders, and PayPal Holdings (NASDAQ:PYPL) announced it is snapping up a fast-growing retail payments company.

Several overlapping generic stock charts

Image source: Getty Images.

Campbell Soup lands in hot water

Shares of Campbell Soup plunged 12.4% after the company reported disappointing results for its fiscal third quarter, issued a gloomy outlook for the remainder of this year and the next, and announced the sudden departure of its CEO. Sales increased 15% to $2.13 billion thanks to acquisitions, but were flat organically. Adjusted earnings per share were up 19% to $0.70. Analysts were expecting adjusted EPS of $0.61 on sales of $2.14 billion.

On a GAAP basis, the company lost $1.31 per share, thanks largely to a pre-tax impairment charge of $1.65 per she that Campbell took due to "reduced expectation of current and future earnings and cash flows" from its struggling Campbell Fresh unit. Moreover, the $0.70 adjusted EPS includes $0.17 of tax benefit due to the timing of a tax event and will be reversed in Q4.

Impacting the profit numbers was huge 3.9-percentage-point decline in gross margin due to cost inflation and what the company characterized as poor execution. Interim CEO Keith R. McLoughlin said on the conference call that the quarter's results were unsatisfactory and that the company will undertake a review of strategy, operations, and portfolio, and stated that "everything is on the table." Looking forward, the company lowered full-year adjusted EPS guidance to a range of $2.85 to $2.90 from the previous outlook of $3.10 to $3.17. 

To make things even worse, Campbell surprised analysts by saying it now expects the Snyder's-Lance acquisition to be dilutive to earnings in 2019.

There just simply wasn't any good news in this report at all, so it's not surprising investors dumped shares today.

PayPal snaps up European retail payment company

PayPal made a move into international in-store payment systems for small businesses when it announced today that it was acquiring Swedish financial technology start-up iZettle in a $2.2 billion cash deal. Investors bid up PayPal's stock 2% on the news.

iZettle, founded in 2010, sells a point-of-sale payment system and merchant tools in 10 countries in Europe and in Brazil and Mexico. It has grown rapidly, handling an estimated $6 billion total payment volume in 2018, and expects to generate $165 million in gross revenue this year. The company is not profitable, but PayPal expects the business to have EBITDA profitability by fiscal 2020. iZettle's founders and management team will join PayPal.

"Small businesses are the engine of the global economy and we are continuing to expand our platform to help them compete and win online, in-store and via mobile," said PayPal CEO Dan Schulman. "iZettle and PayPal are a strategic fit, with a shared mission, values and culture -- and complementary product offerings and geographies."

The acquisition is not cheap, at a multiple of 11 times estimated 2019 revenue, according to PayPal. But it is an excellent strategic move, posing a significant challenge to Square down the road.

Jim Crumly owns shares of PayPal Holdings. The Motley Fool owns shares of and recommends PayPal Holdings. The Motley Fool owns shares of SQ. The Motley Fool has a disclosure policy.