He once visited The Virgin Islands... they are now called The Islands
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? U.S MICHIGAN 1-YEAR INFLATION EXPECTATIONS (MAY) ACTUAL: 3.3% VS 3.5% PREVIOUS; EST 3.4%
? U.S MICHIGAN 5-YEAR INFLATION EXPECTATIONS (MAY) ACTUAL: 3.0% VS 3.1% PREVIOUS; EST 3.1%
? U.S MICHIGAN CONSUMER SENTIMENT (MAY) ACTUAL: 69.1 VS 67.4 PREVIOUS; EST 67.7
? U.S MICHIGAN CURRENT CONDITIONS (MAY) ACTUAL: 69.6 VS 68.8 PREVIOUS; EST 68.8
Morgan Stanley sees 'chance' Chewy announces first buyback program with Q1
Morgan Stanley leans positive into Q1 earnings from Chewy with upside seen to EBITDA margins as well as "the possibility" that the company could announce its first buyback program. However, pressure from the weak pet macro backdrop has persisted and the firm is expecting Q1 revenue and guidance to be in-line, added the analyst, who keeps an Overweight rating and $27 price target on Chewy shares ahead of the report.
UP AFTER EARNINGS -
Booz Allen (BAH) up 5%
Syntec Optics (OPTX) up 3%
Deckers Outdoor (DECK) up 11%
Ross Stores (ROST) up 7%
DOWN AFTER EARNINGS -
The Buckle (BKE) down 4%
Workday (WDAY) down 10%
Domo (DOMO) down 13%
Intuit (INTU) down 5%
LOWER -
Verastem (VSTM) down 60% after announcing that it has initiated the rolling submission of a New Drug Application, or NDA, to the FDA seeking accelerated approval of the combination of avutometinib, a RAF/MEK clamp, and defactinib, a selective FAK inhibitor, for adult patients with recurrent KRAS mutant low-grade serous ovarian cancer, who received at least one prior systemic therapy
Back on the menu
The burger wars are escalating, with Restaurant Brands' (QSR) Burger King bringing back its $5 value meal, which will likely include a sandwich, chicken nuggets, fries and a drink. The move follows reports that McDonald’s (MCD) will launch a $5 value meal in the U.S. beginning on June 25, and more are joining in on the action. Wendy’s (WEN) just announced a $3 morning meal deal that'll include a breakfast sandwich, as well as a small batch of seasoned potatoes.
Cost-conscious: Many Americans squeezed by higher food costs have changed their habits by visiting restaurants less often, even if those are fast food chains. It has also made deals and discounts a bigger part of overall consumer decision-making. Value meals look to provide those options to customers who have grown fatigued by the current environment, and continue to feel wallets before heading to the drive-thru or grabbing a quick bite.
Note that Burger King (QSR) plans to run its new offer for several months, while the promotion from McDonald's (MCD) will likely last four weeks. That's not a long time, which means the discounted meals may not be sustainable, especially with the Golden Arches asking Coca-Cola (KO) to chip in and mitigate some of the costs. Instead, the value offerings will seek to bring back momentum, with the aim of converting the increase in customers into a steady stream of traffic with higher sales.
From the SA comments section: "This is part of a wider story. Target is lowering their prices, other restaurants are also realizing that they have overreached with excessive increases," wrote Investor since ‘73. References to "shrinkflation" were mentioned by user ajvanatta, while jojob852 points out that some chain restaurants have been "really clobbered" due to "wage and food inflation" and starts the discussion on top sector picks when things "finally settle down and people circle back to these names." (39 comments)
Hollywood AI
As the media industry changes tack when it comes to artificial intelligence, with multiple content licensing deals being announced of late, Hollywood may be next. Alphabet (GOOGL) and Meta (META) have reportedly held talks with major Hollywood studios on licensing content for use in AI video generation software, offering tens of millions of dollars. Warner Bros. Discovery (WBD) is keen on licensing some of its programs to train AI models, while Netflix (NFLX) and Disney (DIS) are interested in other types of collaboration. Microsoft (MSFT)-backed OpenAI has held similar discussions on Hollywood partnerships. (4 comments)
More than a ticket
Live Nation (LYV) sank around 8% on Thursday after the DOJ filed an antitrust suit looking to split up what it called an illegal monopoly that has pushed ticket prices higher. "The complaint attempts to portray Live Nation and Ticketmaster as the cause of fan frustration with the live entertainment industry," the company responded, blaming elevated costs on production, artist popularity, and online ticket scalping. "This case will probably take years to materialize," noted SA analyst Yuval Rotem, cautioning that it could pressure the stock whether or not the breakup succeeds. (12 comments)
Crypto win
Security? Commodity? Does it matter anymore? Less than six months after approving the first spot bitcoin ETFs, the SEC is again broadening the reach of the crypto world. The agency has approved applications from Nasdaq (NDAQ), NYSE (ICE), Cboe (CBOE) and five others to list exchange-traded funds that invest directly in ether (ETH-USD). The issuers still need a separate greenlight from the agency before the products can go live, with the deadline yet to be determined. Ether, which rose 20% this week amid ETF optimism, fell 4% following the approval in typical "buy the rumor, sell the news" fashion. (27 comments)
Today's Markets
In Asia, Japan -1.2%. Hong Kong -1.4%. China -0.9%. India flat.
In Europe, at midday, London -0.4%. Paris -0.2%. Frankfurt -0.4%.
Futures at 7:00, Dow +0.2%. S&P +0.3%. Nasdaq +0.3%. Crude -0.8% to $76.26. Gold +0.2% to $2,341.60. Bitcoin -3.2% to $67,341.
Ten-year Treasury Yield unchanged at 4.47%.
Today's Economic Calendar
8:30 Durable Goods
9:35 Fed's Waller Speech
10:00 Consumer Sentiment
1:00 PM Baker Hughes Rig Count
SIFMA Early Close at 2:00 PM
Companies reporting earnings today »
What else is happening...
A costly JFK strike over Memorial Day may have been prevented.
Flip flop? Elon Musk not in favor of U.S. tariffs on Chinese EVs.
Norfolk Southern (NSC) reaches settlement over Ohio derailment.
Boeing (BA) deliveries are not likely to rise from prior levels.
Nvidia (NVDA) is worth more than AMZN and TSLA combined.
Is BHP's merger talk objective to access Anglo's books?
Petrobras (PBR) seen paying out full extra dividends in 2024.
CDC researchers flag increasing ADHD diagnoses in children.
23andMe (ME) not providing guidance amid strategic review.
'Overbought' gold adds to losses after tough Fed talk on rates
Increases in stock option open interest $BMBL $META $PAGS $QCOM $BAC $DKNG $AAPL $NVDA
European stock markets are broadly lower, following on from losses on Wall Street Thursday and a correction across Asia overnight. U.S. futures are higher, though, with the NASDAQ leading the way and up 0.3% as tech bulls start to return. Bonds have pared early gains, but the German 10-year is still down -0.4 bp, the 10-year Gilt down -0.3 bp and the U.S. Treasury rate unchanged at 4.48%. The short end of the Gilt curve outperformed, and the 2-year yield corrected -1.7 bp after weaker than expected retail sales numbers. However, the BoE is unlikely to move during the election campaign, which means it would have to wait until after July 4 before delivering a first cut. The DXY dollar index has dipped below the 105 mark, and oil prices and gold benefited.
goooooooooood morning!!!!!!!!!!
uintuit price target raised to $770 from $760 at Jefferies
Jefferies raised the firm's price target on Intuit to $770 from $760 and keeps a Buy rating on the shares. The stock was down 6% in after-hours trading, which the firm believes was due to "knee-jerk reactions to tax unit share loss" and talk of increased investments raising question on margin trend. However, it believes a deeper look shows strong fundamentals, the analyst tells investors.
uintuit price target raised to $770 from $760 at Jefferies
Jefferies raised the firm's price target on Intuit to $770 from $760 and keeps a Buy rating on the shares. The stock was down 6% in after-hours trading, which the firm believes was due to "knee-jerk reactions to tax unit share loss" and talk of increased investments raising question on margin trend. However, it believes a deeper look shows strong fundamentals, the analyst tells investors.
Workday price target lowered to $330 from $350 at Jefferies
Jefferies lowered the firm's price target on Workday to $330 from $350 and keeps a Buy rating on the shares after the company delivered a "mixed" report. Management also guided Q2 CRPO growth below the Street and lowered FY25 subscription revenue growth guidance to 17% from 17%-18% due to scrutiny in large new deals and lower headcount growth, notes the analyst. However, the firm believes CEO Carl Eschenbach is putting the right initiatives in place despite the near-term challenges, the analyst added.
PDD Holdings price target raised to $224 from $178 at Barclays
Barclays raised the firm's price target on PDD Holdings to $224 from $178 and keeps an Overweight rating on the shares. The company's' Q1 results came in "far ahead" of estimates, especially around margins and profits, the analyst tells investors in a research note. The firm estimates that Temu was close to break-even in Q1, almost two years ahead of the firm's prior timeline.
PDD Holdings price target raised to $224 from $178 at Barclays
Barclays raised the firm's price target on PDD Holdings to $224 from $178 and keeps an Overweight rating on the shares. The company's' Q1 results came in "far ahead" of estimates, especially around margins and profits, the analyst tells investors in a research note. The firm estimates that Temu was close to break-even in Q1, almost two years ahead of the firm's prior timeline.
Spotify experiments with an AI DJ that speaks Spanish
ResMed issues new research, insights into effectiveness of PAP therapy
A number of accomplished medical and scientific experts presented critical new research on sleep conditions and their effect on cardiovascular health at the American Thoracic Society International Conference. The ResMed-supported research provided new insights into the effectiveness of PAP therapy in treating sleep-disordered breathing and its associated clinical benefits. The studies were among 26 supported by ResMed. Real-world Trends of Glucagon-Like Peptide-1 Receptor Agonists and PAP Therapy Use in OSA: The use of GLP-1s did not lead to higher discontinuation rates of PAP therapy, rather this analysis found that patients who were adherent to their GLP-1 medication had higher levels of PAP therapy use than those who were non-adherent to their GLP-1 medication. PAP Therapy Continues to Lower Risks Associated with Sleep Disorders: This meta-study, presented by Dr. Atul Malhotra, found mortality was 37% lower on average in patients with PAP-treated OSA vs untreated OSA. Examining the Prevalence of Obstructive Sleep Apnea in the United States: A study presented by ResMed's research scientist Elroy Boers projected an increase in OSA cases in the United States using patient data calibrated across subgroups of age, sex and body-mass index. Adaptive Servo-Ventilation Patients with Treatment Emergent or Persistent Central Sleep Apnea and Central Sleep Apnea induced by Opioid Use: Two studies evaluated the effects of Adaptive Servo-Ventilation therapy in two populations. One study demonstrated ASV therapy showed a reduced symptom burden and an improvement in quality of life for patients with TE-CSA, with or without comorbid cardiovascular disease, a comorbidity present in a majority of patients with TE-CSA. The second study showed a -1 median reduction in Epworth Sleepiness Scale values and a median increase of .96 on the Functional Outcomes of Sleep Questionnaire, demonstrating a lower symptom burden and improved quality of life. Reducing Risk of Death in COPD Patients with Non-Invasive Ventilation at Home: Another study, also presented by Dr. Jean-Louis Pepin, looked at nearly 50,000 adults with COPD who were treated via domiciliary NIV. The study showed long-term home use of NIV was strongly associated with a reduced risk of death.
Treasury yields are moving higher
Market Action: Treasury yields are moving higher, erasing overnight gains, after the tight claims data. Bonds have lost ground of late as the amid more support for the Fed's "high-for-longer" stance. The solid Nvidia earnings news after the bell yesterday and the subsequent rally in equity futures is also pulling cash out of bonds. The 2-year yield is now 1.5 bps higher at 4.884% after trading as rich as 4.856% overnight. The 10-year rate is up 1.6 bp at 4.437% versus its 4.402% intraday low. Wall Street futures are solidly in the green with the NASDAQ surging 1.2%, while the S&P 500 and the Dow are up 0.69% and 0.16%, respectively. The DXY has stumbled for the first time this week, falling to 104.654 and is down against all its G10 peers amid various cross-currents. Gold is down -0.67% to $2362.96 per ounce as Fed rate cuts remain months away. Crude oil is rallying 1.1% to $78.43 per barrel.
Cytokinetics price target lowered to $90 from $94 at H.C. Wainwright
H.C. Wainwright analyst Joseph Pantginis lowered the firm's price target on Cytokinetics to $90 from $94 and keeps a Buy rating on the shares. The company announced "two significant transactions that provide a major boost" to its finances as well as a a clear signal to financially bolster aficamten's expected commercial launch. The first was a strategic funding collaboration with long-time financial partner Royalty Pharma and the second transaction was pricing of a $500M equity raise, says the firm. It believes the "transactions send a clear message that all operations at Cytokinetics, led by aficamten, are full speed ahead regardless of any potential business development plans." However, there may be added volatility with the shares as some may interpret that a takeover is now off the table following several prior rumors and speculation, adds H.C. Wainwright.
09:16 EDT SNOW
Snowflake price targe
First Solar price target raised to $262 from $240 at JPMorgan
JPMorgan raised the firm's price target on First Solar to $262 from $240 and keeps an Overweight rating on the shares. Exiting the Q1 prints for clean energy, the firm is shuffling its top picks to stocks it believes are relatively best positioned to navigate what it expects to be a volatile remainder of the year. While JPMorgan continues to believe that utility-scale solar has the highest level of demand, it says macro factors are impacting project timing while increasing geopolitical developments present risks. The analyst removed Array Technologies (ARRY) and Shoals Technologies (SHLS) from the firm's Analyst Focus List, believing increasing geopolitical issues and project timing uncertainty "may keep a lid on both stocks near term." JPMorgan's top picks are HASI (HASI) and TPI Composites (TPIC).
HIGHER -
DuPont (DD) up 5% after announcing a plan to separate into three distinct publicly traded companies and that its board selected Lori Koch to succeed Edward Breen as CEO
UP AFTER EARNINGS -
Nvidia (NVDA) up 7%
Evogene (EVGN) up 6%
Endava (DAVA) up 5%
Cellebrite (CLBT) up 2%
TD Bank (TD) up 2%
DOWN AFTER EARNINGS -
Monro (MNRO) down 12%
Titan Machinery (TITN) down 11%
Triumph Group (TGI) down 5%
Bilibili (BILI) down 3%
Ralph Lauren (RL) down 3%
BJ's Wholesale (BJ) down 1%
VF Corp. (VFC) down 8%
Nvidia price target raised to $1,200 from $1,100 at Raymond James
Raymond James raised the firm's price target on Nvidia to $1,200 from $1,100 and keeps a Strong Buy rating on the shares. Nvidia's results and outlook were consistent with the firm's preview for a 5%-10% upside and while Cloud customer demand continues to be strong, Enterprise and Consumer Internet companies drove most of the growth in the quarter, highlighting the broadening AI adoption, the analyst tells investors in a research note. Raymond James expects momentum to sustain into 2H25 and believes that the risk of a near-term customer spending pause is modest given the intense competition among hyperscalers and exponential growth in model complexity.
Best Buy should show signs of stabilization in Q1, says Telsey Advisory
Telsey Advisory says Best Buy's business is likely to experience continued pressure related to the challenging macro trends weighing on discretionary consumer demand in the short term. However, the company should show signs of stabilization and improvement after many consecutive quarters of negative comps as the replacement cycle kicks in, the analyst tells investors ahead of Best Buy reporting Q1 earnings on Thursday, May 30. The firm maintains an Outperform rating and $95 price target on Best Buy shares.
reads
Tesla (TSLA) has started construction of a factory in Shanghai to manufacture energy storage batteries, multiple media outlets reported Thursday, citing the company.
The EV manufacturing giant will invest roughly 1.45 billion renminbi ($204.1 million) in the plant, Xinhua News Agency reported, citing the administration of Lin-gang Special Area of China Pilot Free Trade Zone.
The Shanghai megafactory is expected to start production in Q1 next year, and will manufacture up to 10,000 megapacks annually, Jiemian reported, citing Zhu Xiaotong, a senior vice president of automotive at Tesla.
Nvidia price target raised to $1,160 from $1,000 at Morgan Stanley
Morgan Stanley analyst Joseph Moore raised the firm's price target on Nvidia to $1,160 from $1,000 and keeps an Overweight rating on the shares. The company "again beat by $2 bn and shows no sign of slowing down even during the product transition," says the analyst, who sees "the logic that customers could pause waiting for Blackwell," but adds that the firm's checks would say demand remains very robust. Strength in inference remains an important long term driver, says the firm, which thinks "the backdrop warrants AI exposure even amid extreme enthusiasm" and adds that it believes Nvidia "remains the clearest way to get that exposure."
The way publishers are approaching generative AI is changing as the media industry evolves its outlook on the technologies of the future. Questions had initially centered around how it would impact their workforce or operations, as well as how they could benefit from, or be harmed by, the new developments. Some of those answers are now becoming apparent in many parts of the publishing space, ranging from movies and music to online content and the printed word.
Backdrop: In the early innings of the AI revolution, firms banded together to stave off any threats to their bottom line. Hollywood actors and writers went on strike in part over fear that they might lose or share revenue with machines, while news and media companies started talks to establish a united front against Big Tech over "content scraping" and training their AI models on data produced by their organizations. It now looks like each industry and company will reach separate deals with internet giants that wield tremendous power over distribution and visibility.
Microsoft (MSFT)-backed OpenAI just signed a major content licensing deal with News Corp. (NWSA), which could be worth more than $250M over five years, sending shares of the latter up 7% in premarket trading. That'll give OpenAI access to The Wall Street Journal, Barron's and MarketWatch, and follows similar deals with The Financial Times and Axel Springer - the parent company of Business Insider and other publications. Google (GOOG) (GOOGL) also inked a deal with Reddit (RDDT) earlier this year to use the platform's content to train its AI models, while Meta (META) is reportedly looking to follow suit.
Outlook: Things aren't only evolving in the world of content licensing, but are also beginning to change in the world of content writing. Journalists and writers are experimenting with generative AI for article outlines, headlines and even text. Over at The Washington Post, a new strategy announcement reportedly declared that the paper has to have "AI everywhere in our newsroom" as it seeks to find a way out of its financial hole. The vast majority of Wall Street Breakfast subscribers believe that publishers should currently be required to use a disclaimer when using AI, but will that change as things evolve? Join the discussion in the comments section.
Superpower unleashed
Nvidia (NVDA) surged 6% AH on Wednesday, breaking through the $1,000 level, after the semiconductor giant reported quarterly results and guidance that topped Wall Street's expectations. That wasn't all. The AI darling announced a 10-1 stock split, more than doubled its quarterly dividend, and sent the market on a ride with Nasdaq futures up 1% in overnight trading. "The next industrial revolution has begun," CEO Jensen Huang declared. "Companies and countries are partnering with Nvidia to shift the trillion-dollar traditional data centers to accelerated computing to produce a new commodity: artificial intelligence." (344 comments)
Stronger protections
Looking to bring more oversight to the fast-growing space, the Consumer Financial Protection Bureau has issued an interpretive rule that will treat "buy now, pay later" lenders essentially the same as credit card issuers. BNPL providers like Affirm (AFRM), PayPal (PYPL) and Block's (SQ) Afterpay will now be required to refund returned products, investigate merchant disputes, and provide bills with fee disclosures. Credit card firms currently comply with such rules under the decades-old Truth in Lending Act, but the CFPB has been clamping down on the space, most recently finalizing a rule to cap credit card late fees. (3 comments)
Breaking up
DuPont (DD) is joining sprawling conglomerates like General Electric (GE) and Johnson & Johnson (JNJ) in splitting its businesses into more focused companies. The chemical giant - which was formed in 1802 - will separate into three publicly traded entities, sending its shares up about 5% in premarket trading. DuPont CEO Ed Breen said the break-up plan will unlock incremental value for shareholders and customers, and announced that current CFO Lori Koch will succeed him in his current role, effective June 1. Breen will transition to full-time executive chairman. (14 comments)
Today's Markets
In Asia, Japan +1.3%. Hong Kong -1.7%. China -1.3%. India +1.6%.
In Europe, at midday, London flat. Paris +0.3%. Frankfurt +0.2%.
Futures at 7:00, Dow +0.1%. S&P +0.6%. Nasdaq +1%. Crude +0.7% to $78.13. Gold -1% to $2,368.20. Bitcoin -0.3% to $69,867.
Ten-year Treasury Yield unchanged at 4.42%.
Today's Economic Calendar
8:30 Initial Jobless Claims
8:30 Chicago Fed National Activity Index
9:45 PMI Composite Flash
10:00 New Home Sales
10:30 EIA Natural Gas Inventory
11:00 Kansas City Fed Mfg Survey
3:00 PM Fed's Bostic Speech
4:30 PM Fed Balance Sheet
Companies reporting earnings today »
What else is happening...
Fed minutes: Data didn't increase confidence toward inflation goal.
Target (TGT) falls after pointing to consumer discretionary softness.
Bird flu fears: Vaccine makers see double-digit percentage gains.
Biden cancels $7.7B more in student debt for 160,000 borrowers.
In orbit: SpaceX spy satellites and new Russian 'space weapon.'
Snowflake (SNOW) revenue and outlook shatter expectations.
Anglo American rejects new BHP (BHP) offer, but extends deadline.
British Prime Minister Rishi Sunak calls for national election in July.
Live Nation (LYV) sinks on report DOJ antitrust action is ready.
Solar benefits: An end to China's profit-slashing price war?
Analog Devices price target raised to $280 from $210 at Evercore ISI
Evercore ISI raised the firm's price target on Analog Devices to $280 from $210 and keeps an Outperform rating on the shares following what the firm calls "a solid Beat/Raise" April quarter report. The firm estimates that Analog is shipping 20%-25% below real consumption and that the analog/MCU industry is setting up for a material snap-back in demand in the second half of 2024 due to supply chain inventory over-correction, which leads it to consequently contend that Street estimates "remain too low."
Nvidia price target raised to $1,250 from $1,150 at Wells Fargo
Wells Fargo raised the firm's price target on Nvidia to $1,250 from $1,150 and keeps an Overweight rating on the shares following quarterly results. While pre-quarter sentiment had likely reflected more Q1 2025 datacenter upside, Nvidia's comments on Hopper H200 and Blackwell demand over supply into FY25 will and should be taken as key positive, the firm says. Wells thinks Nvidia's comments on enterprise AI plus cloud rental represented an incremental takeaway. The firm continues to believe this represents an inflecting driver of the company's AI Enterprise software monetization.
National Australia Bank downgraded to Neutral from Buy at Goldman Sachs
Goldman Sachs downgraded National Australia Bank to Neutral from Buy with an unchanged price target of A$34.04, implying 2% downside. The downgrade reflects a more negative view on the Australian banks and the bank's "full" valuation, the analyst tells investors in a research note.
? FTX's Sam Bankman-Fried Being Transferred to New Prison
Federal officials began the process of transferring Sam Bankman-Fried to a new prison early Wednesday, overriding his wish to stay in New York while helping to prepare his appeal, according to a spokesman for the jailed FTX founder.
The spokesman said he could not confirm Bankman-Fried's destination, but people familiar with the matter said the FTX founder was told in recent days that he would be moved to a federal correctional facility in Mendota, California.
jce
Maxim bullish on GigaCloud, initiates with a Buy
As previously reported, Maxim initiated coverage of GigaCloud with a Buy rating and $69 price target. GigaCloud Technology empowers suppliers and resellers to deliver large-parcel merchandise to consumers with fewer touch points and lower costs. The network effect from adding suppliers and resellers to its business-to-business marketplace and its own first-party efforts has enabled it to grow much faster than the furniture category, and the firm expects market share gains to continue. Maxim believes GigaCloud can generate 10%-15% organic sales growth over the next 3-5 years compared to a mid-single-digit normalized category rate
Comments from the Fed's Collins and Mester late Tuesday
Comments from the Fed's Collins and Mester late Tuesday, in a moderated discussion with Bostic, reinforced the " high-for-longer" rate stance. Mester, a voter this year, reiterated that she expects inflation to come down, but it will just take longer than she previously thought. Collins, a non-voter, rephrased that, noting it will take longer to see the progress on inflation necessary to begin easing policy. She added that there are some signs of policy restrictiveness in some data. There is an "elevated degree of uncertainty" on the economy, so policy needs to be well positioned. She said the underlying neutral rate may be higher in the medium term. Mester now believes 2024 growth will be above trend, versus her prior forecast of below-trend. It appears policy is less restrictive as she would have thought, though it is moderating demand. Bostic, a voter, noted the resilience in the economy and said it will take to make a decision on rates. All concurred that "patience" is the right policy course currently and Mester repeated her view that policymakers are "really not taking that big of a risk" in waiting. Indeed she said "this is all about risk management, appropriate risk management now."
CFPB says buy now, pay later lenders must provide legal protections
The Consumer Financial Protection Bureau issued an interpretive rule that confirms that buy now, pay later lenders are credit card providers. Accordingly, such lenders must provide consumers some key legal protections and rights that apply to conventional credit cards, the agency said in a statement. These include a right to dispute charges and demand a refund from the lender after returning a product purchased with a buy now, pay later loan. Publicly traded buy now, pay later providers include Affirm (AFRM), Block's (SQ) Afterpay and PayPal (PYPL).
Edible Garden prices 2.66M shares at $2.26 in public offering
Edible Garden announced the pricing of a public offering of an aggregate of 2,655,000 shares of its common stock, Class A warrants to purchase up to 2,655,000 shares of common stock, and Class B warrants to purchase up to 2,655,000 shares of common stock, at a combined public offering price of $2.26 per share and accompanying warrants. The warrants will have an exercise price of $2.26 per share, will be exercisable immediately upon issuance. The Class A warrants will expire on the fifth anniversary of the original issuance date, and the Class B warrants will expire on the eighteen-month anniversary of the original issuance date. The closing of the offering is expected to occur on or about May 23, 2024, subject to the satisfaction of customary closing conditions. Gross proceeds, before deducting placement agent fees and offering expenses, are expected to be approximately $6.0 million. Maxim Group LLC is acting as sole placement agent in connection with this offering.
HIGHER -
Rezolute (RZLT) up 21% after announcing its RZ402 trial met both primary endpoints
UP AFTER EARNINGS -
Petco (WOOF) up 13%
Williams-Sonoma (WSM) up 8%
Analog Devices (ADI) up 6%
PDD Holdings (PDD) up 5%
Brady (BRC) up 2%
TJX (TJX) up 1%
Urban Outfitters (URBN) up 3%
DOWN AFTER EARNINGS -
Target (TGT) down 8%
Dorian LPG (LPG) down 4%
LOWER -
Tesla (TSLA) down 2% after The Wall Street Journal reported a group of Tesla shareholders are calling for investors to vote against CEO Elon Musk's $46B pay package
Lululemon (LULU) down 4% after announcing the departure of Sun Choe, chief product officer, who has resigned and will leave the company later this month
AI superpower
The chipmaker at the center of the AI revolution will capture the camera this afternoon, with many making big bets before the release of Nvidia's (NVDA) earnings after the bell. It's one of the most talked-about stocks in the financial world, and for good reason. The company is helping to build out all the infrastructure needed to power generative artificial intelligence, selling advanced processors to all the tech bigwigs that are splashing out on hardware like its the 1990s.
Snapshot: Getting all this infrastructure in place will likely take several years, meaning Nvidia is still primed for exponential growth (at least that is the hope). The potential has excited investors, who have sent the stock soaring since last year. Shares just hit fresh all-time highs on Tuesday at over $950 and have nearly doubled year-to-date. NVDA is also up over 550% since the beginning of 2023 and has become the most popularly traded stock on Wall Street.
Nvidia's consensus EPS estimate for Q1 comes in at $5.58 (+412% Y/Y), with a revenue forecast of $24.6B (+242% Y/Y), up from $7.2B in the prior year. That's a staggering difference, with the AI darling making nearly as much revenue per quarter as it used to do on an annual basis. If there is any guide to how shares will trade after earnings, keep an eye on forward guidance, accompanying commentary, and the outlook for the artificial intelligence boom.
Making moves: The options market is pricing in an 8% move either way after earnings, but it could be way more than that, given that Nvidia (NVDA) soared 24% after its last Q1 report. The firm is also now the third-biggest U.S. company by market cap, with a valuation of $2.3T, meaning its influence extends to broader market indices like the Nasdaq 100 (NDX) (with a weight of 6.5%) and S&P 500 (SP500) (with a weight of over 5%). All of that AI enthusiasm has helped propel the bull run in U.S. stocks, leading the major averages to hit record highs this month. Are more in the making?
Up for sale
The U.S. Department of Energy is releasing 1M barrels of gasoline (42M gallons) from the Northeast Gasoline Supply Reserve to help "lower prices at the pump as Americans hit the road this summer." The reserve was authorized in 2014, two years after Hurricane Sandy damaged refineries, but the cache had never been used and was due to be closed in line with a law Congress passed in March. While gas prices are up about 15% YTD, some say the release will not make a significant difference in the East Coast region, which burned through more than 3M bbl/day of gasoline last June alone. (54 comments)
Time running out
The clock is ticking on BHP's (BHP) ambitious bid to acquire rival Anglo American (OTCQX:AAUKF), as the world's biggest miner has until 12 PM ET to make a binding takeover offer. Anglo American already rejected two proposals from BHP and instead revealed a major company overhaul that included plans to sell or demerge its steelmaking coal, nickel, platinum, and diamond businesses. If BHP decides to stop pursuing a deal, it will have to stay away for at least six months, according to U.K. takeover rules. (4 comments)
Tactical nukes
The defense sector is on watch after Russia’s military started exercises to simulate the use of tactical nuclear weapons, which include the Kinzhal missile, the first hypersonic weapon to be used in the Ukraine war. The exercises, ordered by President Vladimir Putin, were said to be in response to "provocative statements" by Western Europe officials, including French President Emmanuel Macron. Tactical nuclear weapons are less destructive than what are known as strategic bombs that can level a city, but they still have significant power. Russia's estimated arsenal of the warheads stands at around 1,500. (1 comment)
Today's Markets
In Asia, Japan -0.9%. Hong Kong -0.1%. China flat. India +0.4%.
In Europe, at midday, London -0.4%. Paris -0.6%. Frankfurt -0.2%.
Futures at 7:00, Dow -0.1%. S&P -0.2%. Nasdaq -0.2%. Crude -0.5% to $78.28. Gold -0.3% to $2,419.30. Bitcoin -1.1% to $70,198.
Ten-year Treasury Yield +3 bps to 4.45%.
Today's Economic Calendar
7:00 MBA Mortgage Applications
9:40 Fed’s Goolsbee Speech
10:00 Existing Home Sales
10:00 Atlanta Fed's Business Inflation Expectations
10:00 Quarterly Services Report
10:30 EIA Petroleum Inventories
1:00 PM Results of $16B, 20-Year Bond Auction
2:00 PM FOMC Minutes
Companies reporting earnings today »
What else is happening...
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