Category Archives: Finance News

Stocks making the biggest moves midday: Nio, Nikola, Microsoft, Qualcomm, ADT & more

Bloomberg | Getty Images

Check out the companies making headlines midday Monday:

Nio — U.S.-traded shares of the China-based electric vehicle company jumped more than 10% after Nio reported July delivery figures. The company said that July deliveries jumped 322% year over year to 3,533 vehicles. Through the end of July the company has delivered 17,702 vehicles this year.

Eli Lilly — Shares of the drugmaker rose 1.5% after the company announced that it started a phase three trial of an experimental preventative treatment for Covid-19. The trial is focused on patients and staff members at long-term care facilities, which have been the site of some of the worst outbreaks in the United States.

Microsoft — Microsoft shares rose more than 3% after the tech giant confirmed it was in talks to buy social video app TikTok. The news comes as President Donald Trump threatened to ban the popular app in the U.S., citing security concerns over the ties between TikTok’s parent company and China.

Clorox  — Shares of the maker of bleach and disinfecting wipes dipped more than 1.5% despite the company beating on the top and bottom lines of its quarterly earnings. Clorox earned $2.41 per share on revenue of $1.98 billion. Analysts polled by Refinitiv expected earnings of $1.99 on revenue of $1.87 billion. The company named President Linda Rendle as the new CEO, effective Sept. 14.

DuPont — An analyst at Stephens downgraded DuPont to equal weight from overweight, noting the company is “lacking” revenue growth that’s driven by “innovation.” “With the economy in the tank, innovation is harder to monetize, which is pushing back recovery further,” the analyst said. DuPont shares fell 1.3%.

Kodak — Kodak shares swooned more than 18% in midday trading as the volatile equity again curbed a significant portion of its eye-popping gains from July. Though Kodak shares are still up more than 700% over the last month after the Trump administration announced a $765 million financing deal, they are now worth $17.30 per share compared with $60 per share just last week.

Nikola — The electric truck maker’s stock jumped more than 7% ahead of the company’s earnings results on Tuesday after the market closes. The report will be the first for the company, which went public through a reverse merger with special purpose acquisition company VectoIQ in June. The stock is currently more than 60% below its June 9 high of $93.99 per share.

Qualcomm — Qualcomm jumped more than 5% after Bernstein upgraded the chipmaker to outperform from market perform. The Wall Street firm said it’s bullish on the upcoming 5G cycle and sees a more “positive” risk/reward than it has been in a long time. Bernstein also cited “a cleaner outlook around customer and regulatory disputes and potential further upside from possible Huawei chip sales.” Last week, the company reported better-than-expected quarterly earnings and revenue.

ADT — The home security stock surged more than 60% after it announced a partnership with Google involving the Nest hardware product. As part of the deal, Google will invest $450 million in ADT to take a 6.6% stake in the company.

Casper Sleep — Shares of the mattress maker dropped more than 11% ahead of a big lock-up expiration. On Tuesday, Casper insiders will be able to sell 31.3 million shares, or 78.8% of the company’s total shares outstanding.

HSBC — The U.S.-listed shares of HSBC fell more than 4% after the banking giant reported a 65% drop in pre-tax profits for the first half of the year due to the coronavirus pandemic. “The first six months of 2020 have been some of the most challenging in living memory,” said CEO Noel Quinn in a statement.

—CNBC’s Yun Li, Pippa Stevens, Maggie Fitzgerald, Jesse Pound, Michael Bloom and Tom Franck contributed to this report.

Let’s block ads! (Why?)


Move over Nikola: A new electric truck SPAC called Lordstown is forming and the shares are surging

The Lordstown Motors Corp. Endurance electric pickup truck is displayed during an unveiling event in Lordstown, Ohio, U.S., on Thursday, June 25, 2020.

Matthew Hatcher | Bloomberg | Getty Images

Shares of DiamondPeak Holdings, a special purpose acquisition company, jumped more than 20% during premarket trading on Monday after the company announced that it will merge with electric vehicle company Lordstown Motors. The combined company will trade on the Nasdaq under the new symbol “RIDE.”

The deal represents two areas of particular investor interest this year: special purpose acquisition companies (SPACs), as well as electric vehicle start-ups.

SPACs are also known as blank-check companies, since investors fork over money without knowing when, or even what for, their capital will be used. Once the SPAC goes public, the goal is then for it to acquire or merge with a private company, thereby taking it public.

Amid market uncertainty and a lackluster IPO market, SPACs are on pace to raise a record amount of capital this year, according to data from Dealogic.

The merger between DiamondPeak and Lordstown Motors, which is expected to close in the fourth quarter of 2020, represents at least the third deal between a SPAC and an electric vehicle start-up this year.

In June Nikola Corporation began trading after a reverse merger with VectoIQ, and in July electric vehicle start-up Fisker said it would merge with Spartan Energy Acquisition, a special purpose acquisition company backed by Apollo Global Management. Investor enthusiasm for the EV space comes amid a more than 240% jump in shares of Tesla this year.

But while investors initially piled into Nikola — sending shares up 150% in the first four days of trading — some of that enthusiasm has since cooled, and on Friday the stock closed at $30.

With more and more players entering the space — start-up EV maker Rivian also announced in July that it raised $2.5 billion in fresh financing — competition is growing. Additionally, Tesla’s past delivery issues underline just how difficult it can be to bring an electric vehicle to market.

According to Monday’s press release, $675 million of expected gross proceeds will be used for the development and commercialization of Lordstown’s all-electric pickup, called the Lordstown Endurance. 

Since the prototype for the pickup truck was revealed on June 25, the company said it has received more than 27,000 pre-orders, which equates to more than $1.4 billion in potential revenue. The bulk of the reservations are from commercial fleet customers. In November 2019 Lordstown Motors purchased a 6.2 million square foot former General Motors assembly plant in order to speed its production process.

The pro forma implied equity value of the merged company is roughly $1.6 billion, which includes $75 million in investments from General Motors as well as commitments from institutional investors including Fidelity Management. 

DiamondPeak holdings raised $250 million in its IPO in March 2019, with the company initially looking to target a “business with a real estate related component.”

Subscribe to CNBC PRO for exclusive insights and analysis, and live business day programming from around the world.

Let’s block ads! (Why?)


Stocks making the biggest moves in the premarket: ADT, Google, Clorox, Eli Lilly, Marathon Petroleum & more

Take a look at some of the biggest movers in the premarket:

ADT (ADT) – Alphabet’s (GOOGL) Google unit will invest $450 million for a 6.6% stake in ADT, as part of a partnership that will see ADT offer Google’s Nest smart home devices to its customers. Each company will also commit $150 million to expand product and service offerings.

Clorox (CLX) – The household products maker reported fiscal fourth-quarter profit of $2.41 per share, beating the consensus estimate of $1.99 a share. Revenue also exceeded forecasts on strong sales of cleaning and disinfecting products. Separately, Clorox named company president Linda Rendle as CEO, effective Sept. 14. Current CEO Benno Dorer will continue to serve as executive chairman.

Eli Lilly (LLY) – The drugmaker has begun a late-stage study to determine if an experimental Covid-19 antibody treatment can prevent the spread of the virus in nursing homes.

McKesson (MCK) – The drug distributor reported quarterly profit of $2.77 per share, beating the consensus estimate of $2.32 a share. Revenue was also above estimates, with McKesson saying volumes across its business rebounded sooner than expected, and the company also raised its full-year outlook.

Tyson Foods (TSN) – The food producer reported quarterly earnings of $1.40 per share, beating the 94 cents a share consensus estimate. Revenue fell short of Wall Street forecasts as beef and pork sales both declined by double-digit percentages. Separately, Tyson named company president Dean Banks to succeed Noel White as CEO, effective October 3.

DiamondPeak (DPHC) – The special purpose acquisition company will merge with electric truck maker Lordstown Motors and take on the Lordstown name. When the deal closes, Lordstown Motors will be listed on Nasdaq under the ticker symbol “RIDE.”

Marathon Petroleum (MPC) – Marathon is selling its Speedway gasoline station and convenience store chain to 7-11 parent Seven & I Holdings for $21 billion in cash. Marathon had been seeking a buyer for Speedway over the past year under pressure from activist investors. Separately, Marathon reported an adjusted quarterly loss of $1.33 per share, smaller than the $1.75 per share loss that Wall Street analysts had been predicting.

Microsoft (MSFT) – Microsoft is planning to move forward with talks to buy video-sharing app TikTok from Chinese owner ByteDance, and hopes to conclude a deal by Sept. 15. That follows weeks of secret negotiations that were nearly upended after President Trump said he favored an outright ban of TikTok in the U.S.

Capital One (COF) – The bank slashed its quarterly dividend to 10 cents per share from 40 cents a share, a cut of 75%. The payout will be made on Aug. 20 to shareholders of record as of Aug. 10.

News Corp. (NWSA) – News Corp. announced the resignation of James Murdoch from its board of directors. Murdoch said he was resigning due to disagreements over editorial policy and other strategic decisions by The Wall Street Journal publisher.

Carnival (CCL) – Carnival postponed the plan start of cruises by its AIDA cruises unit, while it awaits approvals from the Italian government to resume sailings. Trips that had been scheduled between Aug. 5 and Aug. 12 have been canceled.

Varian Medical Systems (VAR) – Varian agreed to be bought by Germany’s Siemens Healthineers for $16.4 billion in cash, or $177.50 per share. The price for the cancer care specialist represents a 24% premium to Varian’s Friday closing price.

Spirit Aerosystems (SPR) – Spirit Aerosystems is cutting 1,100 jobs, with the Boeing (BA) supplier citing jet maker’s recently announced production cutbacks as well as the ongoing pandemic.

Zoom Video Communications (ZM) – Zoom will halt selling products directly to customers in mainland China. According to a letter seen by CNBC, Zoom will begin the new policy on Aug. 23 and only offer services in China through third-party partners.

Nio (NIO) – Nio delivered 3,533 vehicles in July, more quadruple year-ago levels for the Chinese electric vehicle maker. Nio also said it would be able to increase its production capacity significantly to support higher deliveries during the current quarter.

Let’s block ads! (Why?)


Here’s what you need to know about HSBC’s upcoming interim results

A pedestrian walks past illuminated signage for HSBC Holdings Plc displayed outside a bank branch in the Central district of Hong Kong, China.

Anthony Kwan | Bloomberg | Getty Images

HSBC is expected to report a sharp fall in earnings for the first half of 2020 as a result of the economic hit from the coronavirus pandemic and lower interest rates globally.

The London-headquartered bank, Europe’s largest by assets, is scheduled to release its financial report for the first six months of this year at 12 p.m. HK/SIN time. Its shares, listed in Hong Kong and London, have plunged by more than 40% this year, according to Refinitiv data.

HSBC’s reported pre-tax profit is forecast to come in at $5.69 billion for the first half of 2020 — or less than half of $12.41 billion that was reported a year ago, according to analyst estimates compiled by the bank.

Revenue for the six months is expected to be around $26.41 billion, roughly 10% lower than the prior year’s $29.37 billion, the estimates showed.  

The bank, which earns most of its profits in Asia, is also expected to provide an update on its restructuring efforts alongside the release of its financial report card.

HSBC Chief Executive Noel Quinn announced in February a plan that would result in a reduction of around 35,000 jobs. The restructuring would include merging its retail banking and wealth management units, cutting its European equity business as well as reducing branch network in the U.S., he said.

The scheduled announcement of the bank’s financial results follows that of other British banks, many of which reported a slide in profits. British bank Standard Chartered, which is also Asia-focused, on Thursday reported a 33% fall in first-half profits to $1.63 billion.

Let’s block ads! (Why?)