TheChek News Flow

After Hours Summary: Busy earnings night; SOUN +16.6%, TOST +13%, RPD +10.6%, PETQ +8.2%, TWLO +8.1%, AKAM +6.5%, DUOL +5.8% higher on earnings; DOCS -21.8%, UPST -20.4%, ZIP -9.7%, SMCI -9.3%, LYFT -5.9% lower on earnings; PENN +17.4% jumps on ESPN deal

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: SOUN +16.6%, MQ +16.3% (also signs extension SQ to continue powering its Cash App card), BOOM +15.7%, CELH +13.7%, TOST +13%, AZTA +12.7%, ARRY +12%, VUZI +11.5%, RPD +10.6%, AXON +9.5%, LPSN +9% (also CEO steps down), PETQ +8.2%, TWLO +8.1%, BIRD +7.8%, CTOS +7%, AMPL +6.9%, MRTX +6.9% (also CEO steps down; also files $250 mln common stock offering), AKAM +6.5%, VCYT +6%, DUOL +5.8%, LGND +5.8%, CDNA +5%, FLYW +4.6% (also CFO to step down in 2024), GO +4.6%, TMCI +4.6%, RKLB +4.2% (also signs a block buy deal for five Electron launches with BlackSky), CPNG +4.1%, HALO +3.9%, BLNK +3.4%, TWNK +3.4%, TTWO +3.3%, ESTA +2.8%, MEG +2.3%, OSCR +2.2% (also names new CFO), LAZR +1.8%, CLDX +1.8%, KIND +1.8%, BHF +1.7%, BL +1.5%, CMP +1.4%, VRDN +1.3%, QDEL +1.1%, BW +1%, DHT +1%, IPAR +1%, EDR +0.9%, IRBT +0.9%, RIVN +0.9%, QGEN +0.7%, MTTR +0.3%, VTLE +0.3%, DNLI +0.3%, VVX +0.2%, VZIO +0.2%, ICHR +0.1%

Companies trading higher in after hours in reaction to news: PENN +17.4% (enters into online sports betting agreement with ESPN), SCPL +14.8% (LNW to acquire remaining stake in SCPL it does not already own), SKLZ +4.3% (CEO bought 75000 shares), ICVX +3.1% (provides update from its Phase 1b extension trial of IVX-121), ATAI +2.9% (announces results from Phase 1 study of PCN-101), SNV +2.8% (KKR acquires $373 mln of prime auto loans from SNV), WMC +2.4% (MITT to acquire WMC), CWEN +1.5% (files mixed shelf securities offering), BFLY +1% (files $300 mln mixed shelf securities offering), GNRC +0.5% (discloses receipt of grand jury subpoena from DOJ related to Consumer Product Safety Act)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: DOCS -21.8% (also announces 10% workforce reduction), UPST -20.4%, ASLE -16.8%, ANGI -15.8%, BLFS -13.5%, PUBM -11.2%, IAC -10.6%, ZIP -9.7%, MODG -9.3%, SMCI -9.3%, DIOD -8.7%, TWOU -8.2%, LPRO -6.8%, LZ -6.5%, EGHT -6.2%, LYFT -5.9%, CRCT -5.8%, CUTR -5.6%, PDFS -5.6%, BARK -5.4%, JAMF -5.3%, RVNC -4.9%, ACCO -4.8% (also CEO to retire, names new CEO), DXPE -4.8%, SUPN -4.4%, EBS -3.7%, MASI -3.3%, APPS -2.8%, BBAI -2.8%, JXN -2.8%, BMBL -2.7%, RXT -2.7%, DAR -2.1%, SLF -2.1%, AGTI -2%, LNW -2%, HHC -2%, KLIC -1.8% (also collaboration with TSMT; expands collaboration with UCLA CHIPS), STR -1.7%, USPH -1.6%, PODD -1.4%, ME -1.2% (also announces 11% workforce reduction), EXFY -1%, WES -1%, HL -0.8%, TALO -0.6%, GNW -0.6% (also expands share buyback auth by $350 mln), BROS -0.2% (also names new CEO), HRT -0.2%, NHI -0.2%, HBM -0.1%, IOVA -0.1%, PRA -0.1%, VTEX -0.1%

Companies trading lower in after hours in reaction to news: GRND -12.7% (reschedules earnings release date), ATRO -7.2% (initiates $30 mln ATM equity offering program), GTES -6.8% (15 mln share offering), NS -5.2% (12 mln share offering), LNW -2% (LNW to acquire remaining stake in SCPL it does not already own), PKST -2% (files mixed shelf securities offering), MITT -1.9% (MITT to acquire WMC), BSX -1.6% (FDA approves POLARx Cryoablation System), TERN -1.3% (provides update on Phase 2a trial of TERN-501), MCRB -1.2% (files $300 mln mixed shelf securities offering), XFOR -0.6% (names new CMO), KKR -0.3% (KKR acquires $373 mln of prime auto loans from SNV), CLW -0.1% (names new CFO)

(BN) Tesla ‘Master of Coin’ Kirkhorn Exits With $590 Million Fortune

FT : Altice: pressure mounts for Drahi to sell BT investment

Altice: pressure mounts for Drahi to sell BT investment

Selling the investment in the UK telecom would not garner much for the Altice group owner

Patrick Drahi avoids public appearances. When the French telecoms tycoon speaks up, people tune in to hear what he sounds like as well as what he has to say. A criminal investigation into business partner Armando Pereira and steep debts prompted him to address investors on Tuesday.

They were modestly reassured. But actions will speak louder than Drahi’s confident performance.

Drahi’s Altice group has such steep borrowings that asset sales are needed. One holding which might fit the bill is a 24.5 per cent exposure to UK telecom BT Group that includes a big chunk of cash equities.

Drahi did not need the headache of a probe into alleged corruption, of which he denies all knowledge. His Altice companies — Altice France, Altice International and Altice USA — have some $60bn of net debt outstanding. The largest part is owed by the private French company. Its bond prices have sunk well below par. Altice France’s 8 per cent 2027 euro-denominated trades at just under 45 cents to the euro.

The company announced ho-hum second-quarter earnings. Bondholders were more interested in whether Altice France can sell French data centres. But this would raise little more than €1bn. Altice France alone holds about €30bn of net debt, over six times trailing ebitda.

That brings us back to BT. Excitable analysts have speculated whether Drahi wants to buy the whole business. In reality, he could not afford to cover the £31bn enterprise value. Altice International, less leveraged than Altice France at 4.6 times net debt to ebitda, only provides some £300mn annually in dividends to him, thinks fund manager Federated Hermes.

Selling the BT investment would not garner much. At current prices BT is worth £2.7bn to Drahi, assuming the exposure is overwhelmingly in shares. Traders’ gossip is that he has borrowed heavily against the investment. That might leave little more than half a billion pounds of actual equity.

Investors might also read a sale as a sign of desperation. Drahi’s investor call appearance already hints at that.

Electrek : Land Rover to add mini Defender Sport electric SUV to its lineup

Land Rover to add mini Defender Sport electric SUV to its lineup

A new mini Land Rover electric SUV is reportedly due out and could go by the name “Defender Sport.” Despite its compact size, the new EV will carry the brand’s iconic rugged, open-road mentality.

According to Autocar, Jaguar Land Rover (JLR) has been tossing around the idea of a compact SUV but has yet to reveal it in any of its public plans.

The move to expand the Defender brand and add a mini electric SUV was confirmed by CEO Adrian Mardell at a recent JLR investor conference. Mardell stated, “Range Rover, Defender, and Discovery will come off the platform,” regarding the company’s new EMA electric vehicle platform.

After revealing plans to transform its Halewood facility last year, the automaker said it would build at least three or four EVs at the plant.

The new electric models include the Land Rover Discovery Sport, Range Rover Evoque, and Range Rover Velar. Now, the mystery fourth EV has been revealed.

Mini Land Rover Defender Sport electric SUV due in 2027

Although no other details were confirmed about the mini Defender, the fact that it will ride on the EV-only EMA platform gives us enough to work with.

(Source: JLR)

The new mini Discovery electric SUV will be much smaller than the gas-powered versions you see on the road today. The expected Land Rover Discover Sport will ride on its MLA architecture, designed for both ICE and future electric Range Rover variants.

Jaguar Land Rover is looking to maximize the value of each brand after announcing its new rebranding strategy in June.

The new plans call for Range Rover, Defender, Discovery, and Jaguar to become their own individual brands, while Land Rover will remain “a key part of the company’s DNA.”

(Source: JLR)

Speaking with Autocar, JLR’s marketing director, Anthony Bradbury, recently said the Defender is “an explorer’s vehicle, it’s always pushed boundaries, it’s always physically allowed you to do things no other vehicle can. It’s about that spirit of embracing the impossible, and it has been like that for 75 years.”

Even its smallest vehicle, if it wears the Defender name, must have “that feeling of activation, of doing” while embracing the brand’s rugged, open-road mentality.

The 800 V EMA platform will likely be capable of a peak rate of 350 kW. Meanwhile, the batteries will have much higher energy density than the current Jaguar I-Pace, with a new partnership with Agratas (Tata Group) to supply battery packs with up to 450 miles range.

Smaller, more efficient batteries will enable more cabin room and a raised ride height, two features buyers are demanding.

JLR order bank (Source: JLR)

The Defender is one of JLR’s top money-makers. Along with the Range Rover and Range Rover Sport, the three accounted for 76% of the 185K order bank in the first quarter of 2023.

A lower-priced, mini electric Defender Sport SUV would give the brand another potential high-volume seller as it moves into the EV era. The new EV is reportedly due out by 2027.

FT : TSMC to build €10bn chip plant in Germany

TSMC to build €10bn chip plant in Germany

Chipmaker is latest tech group to make use of Berlin’s subsidies as it seeks to diversify globally

Taiwan Semiconductor Manufacturing Company, along with three corporate allies, is to go ahead with a €10bn plant in Germany as the world’s largest contract chipmaker seeks to diversify globally in response to customer concerns over geopolitical tension.

The Taiwan-based group has teamed up with automotive supplier Bosch and chipmakers Infineon and NXP to build the factory in the eastern city of Dresden, a statement from the four companies said on Tuesday. TSMC’s board of directors approved an equity investment of up to €3.5bn in European Semiconductor Manufacturing Company GmbH.

The German government has offered TSMC half of the total — €5bn — in subsidies to support the project, according to a person familiar with the details. The economy ministry in Berlin said its support was in line with the criteria of the European Chips Act, adding that it had issued an exemption permit to allow construction to begin quickly.

Economy minister Robert Habeck, who has fought for subsidies to lure chipmakers, said the factory would be “a significant contribution to securing the supply of semiconductor chips to Germany and Europe”.

The move adds to Berlin’s strategy to become a leading European hub for chip manufacturing, backed by generous state support. The EU as a whole is, meanwhile, seeking to double its share of the global semiconductor market from 10 to 20 per cent by the end of the decade.

Tuesday’s announcement comes on the heels of a decision by Intel in June to build two wafer fabrication sites in eastern Germany in the single biggest instance of foreign direct investment in the country’s history. The chipmaker Infineon, meanwhile, broke ground on its chip factory in Dresden in May.

The joint venture unveiled on Tuesday, of which the Taiwanese company will own 70 per cent while its European partners will each hold one-tenth, aims to start construction in the second half of next year. Production was scheduled to start by the end of 2027, the companies said, adding that the final investment decision depended on the amount of funding from the German government.

“This investment in Dresden demonstrates TSMC’s commitment to serving our customers’ strategic capacity and technology needs,” said CC Wei, TSMC’s chief executive. “Europe is a highly promising place for semiconductor innovation, particularly in the automotive and industrial fields.”

The decision highlights TSMC’s strategic shift from almost exclusive reliance on its Taiwan manufacturing base to several regional production hubs, as governments and chip buyers from around the world fear the repercussions on semiconductor supplies should China attack Taiwan.

While TSMC reluctantly responded in 2019 to pressure from Washington to build a fabrication plant, or fab, in the US, management has pivoted to defending fab investments abroad as a move necessary to keep global customers from defecting to rivals such as Intel and Samsung.

The Dresden fab follows a $40bn investment in a new advanced chip complex in Arizona and a joint venture in Japan, where TSMC is building a plant for making specialty technology — a range of niche chips manufactured using more mature process technology and employed in applications ranging from factory robots to wearables. A second such plant is also being considered.

The German fab highlights the growing significance of the automotive sector for chip demand, driven by the rise of electric vehicles and autonomous driving applications. In the second quarter, automotive applications accounted for 8 per cent of TSMC’s revenue, up from 2 per cent three years ago. European customers asked the company to invest in local production as early as 2021, at the height of a global auto chip shortage, but TSMC took a long time to review the project.

The company decided in favour of the German investment, in a state dubbed Silicon Saxony for the number of semiconductor plants located there, despite serious concerns over a lack of qualified workers as well as shortfalls in materials, tools and services.

Mark Liu, TSMC chair, singled out Germany’s supply chain ecosystem and labour supply as “the two points we are most worried about” at the company’s annual general meeting in June.

“There are indeed some gaps there,” he said. “But the German government promises to build that up in a very short period of time.”

The company has run into similar problems in Arizona, where it has pushed back the target date for starting production by a year to 2025 because of a lack of skilled labour.

>>> US Research Calls

Research Calls

Upgrades:

Axsome Therapeutics (AXSM) upgraded to Neutral from Underperform at BofA Securities; tgt raised to $81

DraftKings (DKNG) upgraded to Buy from Hold at Truist; tgt raised to $44

NovoCure (NVCR) upgraded to Overweight from Neutral at Piper Sandler; tgt $45

Quanterix (QTRX) upgraded to Outperform from Market Perform at SVB Securities; tgt $30

Paymentus (PAY) upgraded to Neutral from Sell at Goldman; tgt raised to $12

Tronox (TROX) upgraded to Neutral from Underperform at Credit Suisse; tgt raised to $13

Smith & Nephew (SNN) upgraded to Neutral from Sell at UBS

Vericel (VCEL) upgraded to Buy from Neutral at BTIG Research; tgt $39

XPeng (XPEV) upgraded to Buy from Outperform at CLSA; tgt $24

Downgrades:

Alteryx (AYX) downgraded to Hold from Buy at Loop Capital; tgt lowered to $30

Alteryx (AYX) downgraded to Neutral from Overweight at Piper Sandler; tgt lowered to $30

Barclays PLC (BCS) downgraded to Neutral from Outperform at Exane BNP Paribas

Chinook Therapeutics (KDNY) downgraded to Neutral from Outperform at Wedbush; tgt $42

Douglas Emmett (DEI) downgraded to Underperform from Neutral at BofA Securities; tgt lowered to $10

Enanta Pharmaceuticals (ENTA) downgraded to Hold from Buy at Jefferies; tgt lowered to $18

FibroGen (FGEN) downgraded to Underperform from Neutral at BofA Securities; tgt lowered to $2

Freshpet (FRPT) downgraded to Neutral from Overweight at JP Morgan; tgt raised to $84

Inogen (INGN) downgraded to Neutral from Overweight at JP Morgan; tgt lowered to $8

Intl Flavors (IFF) downgraded to Hold from Buy at Stifel; tgt lowered to $85

Kilroy Realty (KRC) downgraded to Neutral from Buy at BofA Securities

Maravai Life Sciences (MRVI) downgraded to Sector Weight from Overweight at KeyBanc Capital Markets

National Storage Affiliates (NSA) downgraded to Hold from Buy at Stifel; tgt lowered to $35

Proterra (PTRA) downgraded to Neutral from Buy at BTIG Research

SAGE Therapeutics (SAGE) downgraded to Hold from Buy at Canaccord Genuity; tgt lowered to $21

UWM Holdings (UWMC) downgraded to Mkt Perform from Mkt Outperform at JMP Securities

Westlake Corporation (WLK) downgraded to Underweight from Neutral at JP Morgan; tgt raised to $123

Willis Towers Watson (WTW) downgraded to Underperform from Market Perform at BMO Capital Markets; tgt lowered to $205

WPP plc (WPP) downgraded to Hold from Buy at Deutsche Bank

Others:

APA Corp. (APA) placed on Positive Catalyst Watch at Citigroup; tgt raised to $52

Apogee Therapeutics (APGE) initiated with a Buy at Guggenheim; tgt $29

Apogee Therapeutics (APGE) initiated with a Buy at Jefferies; tgt $29

Apogee Therapeutics (APGE) initiated with a Buy at Stifel; tgt $34

Apogee Therapeutics (APGE) initiated with an Outperform at TD Cowen

Apogee Therapeutics (APGE) initiated with an Outperform at Wedbush; tgt $40

Exelixis (EXEL) initiated with a Market Perform at SVB Securities; tgt $18

IDEAYA Biosciences (IDYA) initiated with an Outperform at SVB Securities; tgt $33

Nuvalent (NUVL) initiated with a Market Perform at SVB Securities; tgt $42

Sagimet Biosciences (SGMT) initiated with a Buy at Goldman; tgt $33

Sagimet Biosciences (SGMT) initiated with a Mkt Outperform at JMP Securities; tgt $30

Sagimet Biosciences (SGMT) initiated with an Outperform at TD Cowen

Sagimet Biosciences (SGMT) initiated with an Overweight at Piper Sandler; tgt $67

Spirit Airlines (SAVE) placed on 90-day downside catalyst watch at Citigroup

Zealand Pharma (ZEAL) assumed with an Equal-Weight at Morgan Stanley

>>> US Gapping down

Gapping down
In reaction to earnings/guidance:

AYX -26.6%, DDOG -22.9%, IFF -21.8%, OLPX -17.9%, BYND -14.2%, RNG -13.9% (appointed new CEO), MRVI -13.8%, INGN -12.7%, MRC -12.6%, TWKS -9.3%, TDW -6.9%, ENR -6.9%, ICUI -5.9%, FIVN -5.7% (to acquire Aceyus), DCGO -4.9%, UPS -4.9%, KNTK -4.7%, LI -4.5%, SEE -4.4%, SWAV -4.2%, ENTA -3.7%, SEAS -3.5%, CTRA -3.2%, DAWN -3.1%, GLBE -3.1%, CXW -3%, GFS -3%, PLTK -2.9%, NSA -2.7%, CRON -2.7%, PLTR -2.4%, AEL -2.3%, MAC -2.3%, CE -2.2%, TDC -2.1%, ARWR -2.1%, HLIO -2%, NOVT -2%, CBT -1.8%, ACM -1.6%, SWKS -1.4%, BLUE -1.4%, KMPR -1.3%, FGEN -1.1%, ZLAB -1%, HPK -1%, VECO -1%, SWIM -1%, UAA -0.9%

Other news:

PTRA -64.9% (files for voluntary Chapter 11 Reorganization to maximize value of the business & product line potential)

HTGC -6.5% (prices offering of 6.5 mln shares of common stock)

SAFE -6% (priced an underwritten public offering of 6500000 shares of its common stock at a public offering price of $21.40/share)

DV -3.8% (prices offering of 12.5 mln shares of common stock at $32.65 per share)

BTDR -3.6% (July operations updates)

USB -3.4% (Moody's reviews U.S. Bancorp for downgrade (senior unsecured at A3))

BK -3.4% (Moody's places Bank of New York Mellon Corporation's ratings on review for downgrade (A1 senior unsecured))

WBS -3.2% (Moody's downgrades Webster (long-term issuer rating to Baa2 from Baa1); outlook stable)

BECN -2.6% (pricing of secondary offering of $83.65/share for its 5 million common stocks)

MTB -2.5% (Moody's downgrades M&T's ratings senior unsecured Baa1; outlook stable)

STT -2% (Moody's places State Street on review for downgrade (holdco senior unsecured A1))

MXL -1.6% (comments on SIMO letter)

LOCO -1.6% (entered into a Stock Repurchase Agreement with FS Affiliates; co agreed to purchase an aggregate of 2500000 shares of common stock from the Sellers at a price of $10.63 per share)

DISH -1.6% (DISH Network (DISH) and SATS confirm combination agreement via all-stock merger)

KMPR -1.3% (exiting preferred home and auto business)

SATS -1.2% (DISH Network (DISH) and SATS confirm combination agreement via all-stock merger)

VRT -1% (stock offering)

Analyst comments:

ENTA -3.7% (downgraded to Hold from Buy at Jefferies)

UWMC -2.8% (downgraded to Mkt Perform from Mkt Outperform at JMP Securities)

DEI -2.6% (downgraded to Underperform from Neutral at BofA Securities)

FRPT -2.4% (downgraded to Neutral from Overweight at JP Morgan)

SAGE -1.6% (downgraded to Hold from Buy at Canaccord Genuity)

WTW -1.2% (downgraded to Underperform from Market Perform at BMO Capital Markets)

FGEN -1.1% (downgraded to Underperform from Neutral at BofA Securities)

TheChek News Flow

(BN) WeWork Tumbles After Raising ‘Substantial Doubt’ About Future

(BN) UAW Demands Would Add $80 Billion to US Carmaker Labor Costs (1)

(BN) L’Occitane Boss Is Said in Advanced Talks on $6.5 Billion Buyout

>>> US After Hours Summary: Busy earnings night; SOUN +16.6%, TOST +13%, RPD +10