He once visited The Virgin Islands... they are now called The Islands
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Increases in stock option open interest $UAA $AG $SNAP $MTCH $TSLA $GME $SOFI $WMT $LCID
Argus upgrades Brinker to Buy, sees accelerating earnings growth rate
Argus upgraded Brinker to Buy from Hold with a $72 price target. The company's new CEO has raised menu prices and scaled back discounting and promotions, while Brinker has also simplified operational processes, revamped its menu, and improved employee retention, the analyst tells investors in a research note. Early results indicate that revenue and margins are headed in the right direction, and Brinker's earnings growth is expected to accelerate to a double-digit rate over the next three years, the firm added.
goooooooooooooooooood morning
Teladoc price target lowered to $14 from $16 at Jefferies
Jefferies analyst Glen Santangelo lowered the firm's price target on Teladoc to $14 from $16 and keeps a Hold rating on the shares after updating the firm's model to reflect Q1 results and updated management commentary. The firm is moderating its outlook for the BetterHelp business given year-over-year comps that "continue to trend in the wrong direction," the analyst tells investors.
Tesla to Make Job Cuts Through June, Leaving Workers in Limbo
Apple Responds to Huawei Threat By Slashing iPhone 15 Prices in China
Rekor Systems, MS2 partner for FHWA 13 bin traffic data integration
Rekor Systems announced a partnership with MS2, the national leader in Transportation Data Management Systems. This partnership seamlessly integrates real-time FHWA 13 bin traffic data from the Rekor Discover traffic analytics platform and Rekor Edge Series systems into MS2's cloud-based TDMS. This integration of leading AI technology and modernization of traffic studies is a key outcome of MS2's recent entry into the Rekor Partner Network, a nationwide ecosystem of technology, data, and solution providers working together to generate the most comprehensive view of roadway intelligence and infrastructure data, aimed at solving transportation and mobility challenges and streamlining innovation.
It's settled
Markets are only a week away from a new settlement cycle as the Securities and Exchange Commission (SEC) and the Depository Trust & Clearing Corporation (DTCC) move the industry to "T+1." Currently, market players are required to physically deposit stock in an account within two days of making a transaction, in a process known as "T+2." During that time, brokers have to post collateral to the DTCC because equity prices can fluctuate over those 48 hours and some buyers/sellers are using margin/borrowed shares, so the lag can make sure everything turns out all right.
Backdrop: For many years, markets operated on a "T+5" settlement cycle, when security transactions were done manually. In the 1990s, the SEC shortened the settlement cycle to three business days, which reduced the amount of money that needs to be collected at any given time. It was only in 2017 that the commission moved to T+2, calling the previous standard an outdated "settlement cycle" due to improvements in technology, emerging new products and growing trading volumes. Note: The move to T+1 will also impact ETFs, certain mutual funds, REITs and MLPs.
One of the biggest catalysts to speed up the clearing timeframe was the meme stock trading frenzy of 2021, which ironically, just resurfaced. Brokers were forced to post collateral during the settlement period and eventually had to restrict trading to ensure they had enough margin in the funds held by the DTCC. Some have even called for real-time settlement, like Robinhood (HOOD) CEO Vlad Tenev, who came away from the GameStop (GME) saga with condemnations from the retail crowd given the platform's slogan to "democratize finance for all."
Is it a possibility? The benefits of an even shorter settlement cycle are controversial. This could eventually fail to protect market participants by not giving enough time to detect failed trades, correct settlement instructions or deal with compliance issues. Instant settlement (T+0) would also require expensive updates to almost all market infrastructure and could do away with benefits like settlement netting, strain dealer resources, or weigh on important trading tools like margin purchases of stock. Other alternatives are also being explored, including T+0.5 or T+evening, where market trades would be settled the same day. Take the WSB survey.
Mideast watch
Energy markets are in the spotlight after the death of Iranian President Ebrahim Raisi in a helicopter crash was confirmed, as well as fresh headlines out of Saudi Arabia. Despite uncertainty related to major crude producers, the market impact of the developments has so far been contained. Raisi, who oversaw the acceleration of Iran's nuclear program, had long been viewed as a potential successor to Supreme Leader Ayatollah Ali Khamenei. Separately, Saudi Arabia's Crown Prince Mohammed bin Salman postponed a four-day visit to Japan as King Salman is being treated for lung inflammation. (3 comments)
AnEther ETF
Despite the recent success of spot Bitcoin (BTC-USD) exchange-traded funds, the crypto industry does not expect the SEC to approve more similar products. The regulator has until May 23 to announce its decision on VanEck's spot Ether (ETH-USD) ETF application, but issuers have indicated that there was limited communication and feedback from the SEC regarding their applications. A rejection by the SEC could potentially lead to lawsuits. Recall that Grayscale Investments' legal win last August paved the way for the approval of spot Bitcoin ETFs.
Under the sea
It's official! Red Lobster has filed for Chapter 11 bankruptcy after it buckled under mounting losses, costly leases, and rising material and labor costs. The company intends to use the proceedings to drive operational improvements, close restaurants, and pursue a sale of substantially all of its assets as a going concern. Red Lobster also announced a stalking horse bid from its existing lenders and $100M debtor-in-possession financing. The bankruptcy caps off years of financial troubles, which prompted top shareholder Thai Union Group (OTCPK:TUFBY) to look to exit its stake. (4 comments)
Today's Markets
In Asia, Japan +0.7%. Hong Kong +0.4%. China +0.5%. India closed.
In Europe, at midday, London +0.3%. Paris +0.5%. Frankfurt +0.4%.
Futures at 7:00, Dow flat. S&P +0.1%. Nasdaq +0.2%. Crude -0.2% to $79.41. Gold +0.9% to $2,439.80. Bitcoin -0.1% to $67,136.
Ten-year Treasury Yield unchanged at 4.42%.
Today's Economic Calendar
Fed's Bostic Speech
9:00 Fed’s Barr: "Bank Supervision and Regulation"
9:00 Fed’s Waller Speech
10:30 Fed's Jefferson: "The U.S. Economy and Housing Price Dynamics"
7:00 PM Fed's Bostic Speech
Companies reporting earnings today »
What else is happening...
Goldman Sachs: The name Magnificent 7 needs to be retired.
OpenAI seeks to address concerns after safety execs' exit.
Mercedes autoworkers in U.S. vote against union membership.
Delayed again! Boeing’s (BA) first crewed flight of Starliner.
... and is sanctioned by China over arms sales to Taiwan.
Boston Scientific (BSX) succeeds in trial for leadless pacemaker.
U.S. Steel (X) buyout in focus as key Nippon Steel exec to visit U.S.
Biden administration seeks end to coal leasing in Powder River Basin.
Target (TGT) lowers prices on thousands of frequently shopped items.
SA Roundtable: Are Eli Lilly (LLY), Novo Nordisk (NVO) overvalued?
Agrify, Nature's Miracle agree to terminate plan of merger
Agrify Corporation (AGFY) announced that Agrify Corporation and Nature's Miracle Holdings (NMHI) have mutually agreed to terminate the agreement and plan of merger, previously announced on May 16, 2024, given unfavorable market conditions. In connection with the termination of the merger, Agrify and NMHI have executed a termination agreement with respect to the merger agreement and have also terminated a debt purchase agreement with entities controlled by Agrify's CEO with respect to the purchase of outstanding debt. Each of the termination agreements contained mutual releases. Raymond Chang, CEO stated, "Agrify continues to see strong momentum and pipeline growth quarter over quarter in both cultivation and extraction business divisions. We believe that it is in Agrify's best interest to stay the course and continue to execute. Agrify's management team and Board are committed to continuing to explore all strategic options in order to create the highest shareholder value."
Rubrik initiated with a Buy at Citi
Citi analyst Fatima Boolani initiated coverage of Rubrik with a Buy rating and $46 price target. The analyst believes the company's "robust and moder"n data protection platform is well positioned against the "steady convergence of these disciplines." The company can "disrupt a sleepy," three-decade-old, $30B-large backup and recovery and storage market, creating unique share dislocation optionality, files to sell common stock, no amount given
goooooooooooooooooooood morning bobber
Largest increases in stock option open interest $PTEN $GOOGL $FFIE $NXE $WMT $AMD $KO $SHOP $WAB
wow
YARDENI: “.. In our #Roaring20s scenario, the $DJIA could increase 50% through the end of the decade to 60,000 in 2030. The S&P 500 should also increase 50%, to 8000, in this scenario.”
— Carl Quintanilla (@carlquintanilla) May 20, 2024
- @yardeni $SPX 🇺🇸 pic.twitter.com/sPNKjEidbb
Nvidia price target raised to $1,085 from $910 at Stifel
Stifel analyst Ruben Roy raised the firm's price target on Nvidia to $1,085 from $910 and keeps a Buy rating on the shares ahead of the company reporting its fiscal Q1 of FY25 results after market close on Wednesday, May 22. A "beat/raise is widely anticipated" once again, notes the analyst, who is expecting "another round of strong results and outlook" as the AI infrastructure investment cycle continues. The firm is not expecting any meaningful change in tone or messaging relative to what was heard at GTC in mid-March, the analyst said in the earnings preview note, adding that Nvidia remains the firm's top pick relative to the AI infrastructure investment theme.
Activist Hedge Fund Elliott Builds $1 Billion-Plus Stake in Johnson Controls
Li Auto sees Q2 revenue $4.1B-$4.3B, consensus $5.21B
The company said, "For the second quarter of 2024, the Company expects: Deliveries of vehicles to be between 105,000 and 110,000 vehicles, representing an increase of 21.3% to 27.1% from the second quarter of 2023. Total revenues to be between RMB29.9 billion (US$4.1 billion) and RMB31.4 billion (US$4.3 billion), representing an increase of 4.2% to 9.4% from the second quarter of 2023. This business outlook reflects the Company's current and preliminary views on its business situation and market conditions, which are subject to change."
Asian stock markets moved higher, following on from Friday's historic close for the Dow Jones, which settled above the 40K mark for the first time. The MSCI Asia Pacific index lifted for a seventh consecutive day, with rate cut hopes adding support. China's additional program for the beleaguered property sector (announced on Friday) also helped, and European and U.S. futures are also posting gains. Trading in Europe is likely to be quieter than usual, with public holidays in some countries - including Germany and France. EGBs are slightly lower, though and the Treasury yield little changed, after yields nudged higher across Asia overnight. The DXY dollar index is at 104.455 and the front end WTI contract is trading at USD 80.35 per barrel.
Micron upgraded to Equal Weight from Underweight at Morgan Stanley
Morgan Stanley upgraded Micron Technology to Equal Weight from Underweight with a price target of $130, up from $98. The firm says it overestimated how much significant 2023 losses would weigh on the stock's valuation, and underestimated both the economic and narrative elements of artificial intelligence memory. The analyst still sees Micron as "fundamentally overvalued" on long term metrics. However, high-bandwidth memory continues to drive sentiment from memory buyers, leading to sustained pricing strength, the analyst tells investors in a research note. Morgan Stanley believes the company could see positive preannouncement this quarter
Steel Dynamics initiated with a Hold at Jefferies
Jefferies initiated coverage of Steel Dynamics with a Hold rating and $150 price target. The macro backdrop for the metals and mining sector has improved, mostly due to the resilience of the U.S. economy and potential for a metals-intensive fixed asset investment cycle in the U.S., the analyst tells investors in a research note. The firm says that while base metals miners should benefit from this improving demand outlook, U.S. steel producers may be the biggest beneficiaries due to emerging steel "megatrends." Jefferies put Buy ratings on Cleveland Cliffs (CLF) and US Steel (X) to reflect structural shifts in the U.S. steel markets. It put Hold ratings on Nucor (NUE) and Steel Dynamics (STLD) based on relative valuations, but expects the companies to benefit from longer-term structural shifts in the sector. The firm's overall positive view on the space is predicated on a "soft (or no) landing" in the U.S., noting steel is still highly cyclical.
APH
Amphenol initiated with a Buy at Seaport Research
Seaport Research initiated coverage of Amphenol with a Buy rating and $150 price target.
Humana price target raised to $376 from $342 at BofA
BofA analyst Kevin Fischbeck raised the firm's price target on Humana to $376 from $342 and keeps a Neutral rating on the shares. The firm cites a higher multiple given the positive data points in its Trend Tracker along with the company's commentary at BofA's conference that trend is coming in slightly better than expected for a higher price target, but reiterates a Neutral rating as it sees the value in Humana's platform over the long-term being offset by short-term headwinds.
Fed's Bowman repeated her baseline view that "inflation will decline further"
Fed's Bowman repeated her baseline view that "inflation will decline further" given the current restrictive policy stance, in her brief comments. But she still sees "a number of upside inflation risks," including strong consumer demand for services, continued tight labor markets, and increased immigration. Additionally, the looser economic conditions since late last year and more fiscal stimulus could further support demand, either stalling further progress on inflation or causing it to pick up. And she expects inflation will remain elevated for "some time." Also she repeated that she is willing to hike rates again if necessary.
It took 121 years for the Dow Jones Industrial Average to reach 20,000.
It then took 7 years to reach 40,000.
GME: Wedbush Raises Target price to $7 from $5.60 while maintaining a Underperform rating.
Microsoft price target raised to $500 from $450 at RBC Capital
RBC Capital raised the firm's price target on Microsoft to $500 from $450 and keeps an Outperform rating on the shares after hosting the company's Directors of Investor Relations James Ambrose and Josh Elvidge in Canada. The discussion has left the fim more positive on the company's runway of growth and leadership in AI, the analyst tells investors in a research note, adding that while Microsoft's CapEx will likely continue to ramp and impact margins, the company is following demand signals and is simultaneously focused on bringing the cost curve down.
HIGHER -
Reddit (RDDT) up 10% after OpenAI announced a partnership with the company on ChatGPT
UP AFTER EARNINGS -
Safe & Green (SGBX) up 20%
Canaan (CAN) up 5%
RBC Bearings (RBC) up 1%
DOWN AFTER EARNINGS -
H World Group (HTHT) down 1%
DXC Technology (DXC) down 3%
Take-Two (TTWO) down 2%
LOWER -
GameStop (GME) down 20% after filing to sell 45M shares of Class A common stock and providing its Q1 outlook
Cracker Barrel (CBRL) down 12% after update on capital allocation and dividend cut
BLACKROCK CEO: WE ESTIMATE TRILLIONS OF DOLLARS OF CAPITAL ARE NEEDED TO BUILD AI DATA CENTRES
gooooooooooooooooooooooooooood morning bobber
morning readessssssssssssss
https://www.optionmillionaires.com/morning-reads-451/
morning readessssssssssssss
https://www.optionmillionaires.com/morning-reads-451/
$GME
GAMESTOP FILES TO SELL UP TO 45M SHARES
GAMESTOP ENTERED INTO AN OPEN MARKET SALE PACT
GAMESTOP SHARES EXTEND PREMARKET DECLINE TO 22%
GameStop Corp. (NYSE: GME) ("GameStop" or the "Company") today announced certain preliminary unaudited financial information for the first quarter ended May 4, 2024 .
On a preliminary basis for the 13-weeks ended May 4, 2024 compared to the 13-weeks ended April 29, 2023 :
-- Net sales are expected to be in the range of $0.872 billion to $0.892
billion compared to $1.237 billion in the prior year fiscal quarter.
-- Selling, general and administrative ("SG&A") expenses are expected to be
in the range of $290 million to $300 million , compared to $345.7 million
in the prior year fiscal quarter.
-- Net loss is expected to be in the range of $27 million to $37 million ,
compared to a net loss of $50.5 million in the prior year fiscal quarter.
-- Cash, cash equivalents and marketable securities are expected to be in
the range of $1.073 billion to $1.093 billion , compared to $1.310 billion
at the close of the prior year fiscal quarter.
Coinbase upgraded to Neutral from Underperform at BofA
BofA upgraded Coinbase to Neutral from Underperform with a $217 price target
JD.com price target raised to $41 from $39 at Barclays
Barclays raised the firm's price target on JD.com to $41 from $39 and keeps an Overweight rating on the shares. The company reported strong 1Q results, especially around margins, which showcase JD's competitive differentiation and inherent operating leverage, the analyst tells investors in a research note.
Reddit price target raised to $65 from $62 at Deutsche Bank
Deutsche Bank raised the firm's price target on Reddit to $65 from $62 and keeps a Buy rating on the shares. Reddit announced a deal to license its data to OpenAI, as well as to incorporate Reddit content into ChatGPT's chatbot and other products, the analyst tells investors in a research note. The firm says that while terms were not disclosed, of note was Reddit's ability to build artificial intelligence-powered features on OpenAI's platform of AI models and OpenAI becoming a Reddit advertising partner. If the cash terms are similar to the Google deal, it could provide $54M of annual EBITDA, assuming 90% incremental margins, says Deutsche Bank. It sees a path to $360M of annual revenue, yielding $324M in annual EBITDA for Reddit. The OpenAI partnership suggests widespread demand for Reddit data, the firm adds.
Sony Music sends warning letters over AI use of its artists, FT reports
Sony Music (SONY) has sent letters to more than 700 AI companies, developers, and music streaming platforms around the world warning over the "unauthorized use" of Sony's content in training AI, The Financial Times' Daniel Thomas reports. According to people close to the company, Sony Music sent the letter to companies developing AI systems including OpenAI, Microsoft (MSFT) and Google (GOOGL), and sent separate letters to streaming platforms, including Spotify (SPOT) and Apple (AAPL), asking them to adopt "best practice" measures to protect artists and songwriters and their music from scraping, mining and training by AI developers without consent or compensation
BofA sees share volatility for Nvidia despite expected Q1 beat
BofA says Nvidia remains a top pick ahead of its Q1 report on May 22 with a Buy rating and $1,100 price target. The firm expects strength versus consensus estimates, but says the stock will be volatile in the near-term due to three factors: Quarterly deceleration ahead of Blackwell, Greater China dependence for the second half of the year, and a limited update to the "40% inference mix" metric. The analyst also believes investor expectations are above consensus estimates for the April and July quarters. BofA expects a "beat/raise" quarter for Nvidia but also near-term deceleration ahead of Blackwell.
Oppenheimer remains bullish on Arvinas amid waning enthusiasm over combo data
Oppenheimer notes that six months ago, Arvinas was arguably the biggest winner at SABCC, with ARV-471 + palbociclib combination data that looked better than the competition. Since then, the company's stock has pulled back. Arvinas put out additional data today from the same Phase 1 combo trial, but it seems the Street has largely turned a blind eye, the firm points out. Admittedly, the update only focused on longer-term follow-up, but it's clear that investors have concerns about the reproducibility of this data set amongst changes in the treatment landscape. For these reasons, Oppenheimer's valuation continues to center on VERITAC-2. The firm reiterates an Outperform rating on the shares with a price target of $70.
SPY new ath today