Gapping down
In reaction to earnings/guidance:
- BOXD -6% (provides Q3 operating metrics), REVG -5.8%, NUE -3.3%, CLSK -1.7%
Other news:
- LEGN -7.3% (announces public offering of $300 mln of ADSs)
- LESL -5.9% (prices offering of 12500000 shares of common stock by certain non-management stockholders)
- BGNE -5.5% (closes $3.5 bln IPO on the STAR Market of the Shanghai Stock Exchange)
- ENTG -3.6% (Entegris and CMC Materials (CCMP) announce a definitive merger agreement under which Entegris will acquire CMC Materials in a cash and stock transaction with an enterprise value of ~$6.5 bln)
- RRD -1.7% (to be acquired by Chatham for $10.85/sh; terminates prior merger deal with Atlas)
- GRWG -1% (COO retires)
Analyst comments:
- ADGI -5.5% (downgraded to Hold from Buy at Stifel; downgraded to Neutral from Buy at Guggenheim)
- ALB -4.7% (downgraded to Sell from Neutral at Goldman)
- EVER -4.1% (downgraded to Underweight from Neutral at JP Morgan)
- DPZ -2% (downgraded to Underweight from Equal Weight at Barclays)
- HAE -1.5% (downgraded to Neutral from Buy at Citigroup)
- CMCSA -1.2% (downgraded to Neutral from Buy at Citigroup)
- HOLX -0.8% (downgraded to Neutral from Buy at Citigroup)
- GLPI -0.7% (downgraded to Sector Perform from Sector Outperform at Scotiabank)
- JKHY -0.6% (downgraded to Mkt Perform from Outperform at Raymond James)
Gapping up
In reaction to earnings/guidance:
- SKIL +5.5%, LLY +5.1% (guidance update), COHU +1.5% (updated mid-term financial target models), BCO +0.8%
Other news:
- CCMP +19.8% (Entegris and CMC Materials (CCMP) announce a definitive merger agreement under which Entegris will acquire CMC Materials in a cash and stock transaction with an enterprise value of ~$6.5 bln)
- OCGN +5.8% (reports new data suggest COVAXIN (BBV152) vaccine candidate generates robust immune memory to COVID-19 and variants of concern for at least six months after vaccination)
- LLY +5.1% (mirikizumab met primary endpoint and all key secondary endpoints in Phase 3 study)
- DWAC +4.4% (enters into technology and cloud services agreement with Rumble)
- VIR +4.3% (preclinical data highlight the significant antigenic shift of the Omicron variant)
- CONN +3.3% (authorization of $150 million share repurchase program)
- NILE +3.3% (authorized a stock repurchase program under which BitNile may repurchase up to $50 million of its outstanding common stock over a three-year period commencing December 15)
- REE +2.7% (forms strategic agreement with Hitachi America to accelerate the adoption of EVs)
- PANL +2.7% (announces the passing of CEO and founder Ed Coll)
- ONEW +2.7% (entered into a definitive agreement to acquire a majority interest in Quality Boats )
- INCY +2% (FDA accepts for Priority Review of sNDA for ruxolitinib for treatment of vitiligo)
- BLU +2% (prices offering of 25 mln shares of common stock at $8.00 per share)
- CAN +2% (secured purchase order of 30000 Bitcoin mining machines)
- XXII +1.8% (ACB and XXII announce IP license agreement with CRON)
- KBR +1.3% (awarded eight prime contracts on GSA's ASTRO program)
- LAZR +1.2% (priced upsized offering of $550.0 mln (from $500 mln) of its 1.25% convertible senior notes due 2026 with net proceeds ~$535.3 mln)
- CMI +1.1% (authorizes share repurchase up to $2 bln in shares of common stock upon completion of its 2019 $2 bln share repurchase program)
- TTC +1% (increases dividend)
- AVIR +1% (introduces updated program for AT-527 in COVID-19; to close out Phase 3 MORNINGSKY trial)
- KULR +1% (received three-year multi-million dollar deployment order for its Passive Propagation Resistant solution suite from Volta Energy Products a subsidiary of Viridi Parente)
Analyst comments:
- FATE +4.7% (upgraded to Outperform from Neutral at Wedbush)
- HUN +2.5% (upgraded to Buy from Neutral at Goldman)
- IRTC +2.5% (upgraded to Buy from Neutral at Citigroup)
- BKNG +2.4% (upgraded to Overweight from Neutral at JP Morgan)
- IIVI +2.4% (upgraded to Overweight from Equal-Weight at Morgan Stanley)
- CMP +1.9% (upgraded to Neutral from Sell at Goldman)
- KEY +1.8% (upgraded to Buy from Underperform at BofA Securities)
- MAS +1.6% (upgraded to Overweight from Equal Weight at Barclays)
- CMA +1.2% (upgraded to Neutral from Underweight at JP Morgan)
- EW +1.2% (upgraded to Buy from Neutral at Citigroup)
- EDR +1.1% (upgraded to Overweight from Equal-Weight at Morgan Stanley)
Early premarket gappers
- Gapping up:
- VIR +6%, XXII +6%, NILE +5.9%, CONN +4.8%, SKIL +4.4%, DWAC +4%, REE +2.7%, PANL +2.7%, INCY +2%, CAN +1.8%, LAZR +1.6%, KBR +1.3%, PFE +1.1%, AVIR +1%, RTX +0.7%, CMI +0.7%, LAUR +0.6%, SNY +0.6%
- Gapping down:
- LEGN -6.8%, BGNE -6.6%, LESL -5.6%, BOXD -4.4%, RRD -2.8%, AA -1%, TTC -0.8%, SGH -0.5%
Fixed-term deals for Britain’s energy price cap proposed by Ofgem
Regulator seeks to prevent another meltdown in electricity and gas market
Households whose energy bills are protected by Britain’s energy price cap could be locked into six-month deals similar to fixed-term mortgages, under proposals set out by the regulator Ofgem to prevent another meltdown in the country’s electricity and gas market.
Ofgem has set out three potential changes to the price cap, which dictates bills for more than 15m households, following complaints by some suppliers that the current methodology is too inflexible and leaves them unable to quickly pass on costs to consumers when wholesale energy prices unexpectedly surge.
The proposals mark the strongest acknowledgment yet by the regulator that the way the price cap is structured is not fit for purpose. The cap was introduced in 2019 at the behest of then prime minister Theresa May’s government to protect people from what she saw at the time as “rip off” energy bills.
“The current price cap methodology, whilst protecting consumers from price spikes, exposes suppliers to risks that are harder to manage at times of high energy price volatility,” the regulator said.
“There is a risk that, if not tackled, this could lead to higher costs for consumers.”
Other options involve reviewing the price cap quarterly rather than every six months, or even more frequently in the event of “extreme” volatility in wholesale markets.
A “call for input” on changes to the price cap was published on Wednesday alongside several other proposals to improve the financial resilience of the market.
More than 25 suppliers have gone bust since the start of August as sharp rises in wholesale energy prices since the summer have exposed deep vulnerabilities in many companies’ business models.
Ofgem also confirmed that energy suppliers would be subject to financial stress-testing from January while it plans to explore how to protect customers’ credit balances, built up via direct debit payments, and prevent companies from misusing those to meet other financial commitments.
Ofgem warned that even well-run suppliers are facing potential losses, as many households are choosing to switch to price cap-protected deals when their fixed-price deals expire. In normal times those customers would shop around for other fixed deals but those tariffs are now hundreds of pounds more expensive than the price cap.
This is creating problems for suppliers because there is an estimated £700 difference per household a year between the costs of buying energy on wholesale markets and the amount suppliers can charge under the price cap, which was last reviewed in October and will not change again until April.
When wholesale prices fall, suppliers fear further losses if customers switch to cheaper fixed-price deals, when they have already agreed to buy the energy for those customers at a much higher price.
Suppliers have long complained that the current methodology includes an eight-month lag between the wholesale prices that are used to inform the level of the cap and when those costs can be passed on to consumers.
Ofgem acknowledged that if the price cap is not changed, “there is a risk of further supplier failures and exits, and an undermining of investor confidence to enter or invest in the retail market”.
“This could lead to reduced competition and higher costs for consumers,” it added.
Suppliers have until January to provide feedback on the potential adaptations before a formal consultation is launched in 2022, if there is sufficient support for changes. Ofgem intends to introduce any changes in October 2022.
A move to fixed-term price cap deals could prove controversial with some consumer groups, however, because they would involve exit fees.
At present, households are free to switch away from price cap-protected tariffs at any time.
>>> Up
* Bpost Raised to Overweight at Barclays; PT 10 euros
* Cibus Nordic Raised to Buy at Pareto Securities; PT 300 kronor
* Dustin Raised to Buy at Handelsbanken; PT 130 kronor
* Elmos Semiconductor Raised to Buy at Hauck & Aufhaeuser (+)
* Eurofins Scientific Raised to Buy at Stifel; PT 130 euros
* Jumbo Raised to Buy at HSBC; PT 17.50 euros
* Jumbo Raised to Buy at HSBC; PT 17.50 euros
* Tullow Raised to Sector Perform at RBC; PT 90 pence
* UniCredit Raised to Market Perform at KBW; PT 15.40 euros
>>> Down
>>> Down
* Aker BP Cut to Sector Perform at RBC; PT 275 kroner
* DCC Cut to Underweight at Barclays; PT 5,550 pence
* Harbour Energy PLC Cut to Sector Perform at RBC; PT 480 pence
* Harbour Energy PLC Cut to Hold at Berenberg; PT 350 pence
* Lundin Energy Cut to Underperform at RBC; PT 290 kronor
* Lundin Energy Cut to Underperform at RBC; PT 290 kronor
* PostNL Cut to Equal-Weight at Barclays; PT 4 euros
* SIG Combibloc Cut to Underweight at Barclays
* Umicore Cut to Hold at HSBC; PT 36 euros
>>> Initiation
>>> Initiation
* Aixtron Reinstated Equal-Weight at Morgan Stanley; PT 19 euros
* Aker Carbon Capture Rated New Sell at SpareBank; PT 15 kroner
* BE Semiconductor Rated New Underweight at Morgan Stanley
* BEWi Rated New Hold at Pareto Securities; PT 75 kroner (+)
* Daimler Truck Holding Rated New Buy at Deutsche Bank
* Daimler Truck Holding Rated New Buy at Deutsche Bank
* Desert Control Rated New Buy at Pareto Securities; PT 50 kroner (+)
* DHH Rated New Buy at Alantra Equities; PT 22.50 euros (+)
* Empiric Student Rated New Buy at Liberum; PT 110 pence
* Pod Point Group Rated New Equal-Weight at Barclays; PT 250 pence
* Stelrad Group Rated New Buy at Investec; PT 285 pence (+)
>>> Call
>>> Call
* BPER Offer for Carige an Opportunity to Increase Footprint: Citi (+)
* Colruyt Stuck Between Higher Costs and Competition: Jefferies (+)
* Cucinelli 4Q ‘Strong’ and Guidance Raised, Jefferies Lifts PT (+)
* Dustin Upgraded to Buy, SHB Calls It ‘Perfect M&A Candidate’ (+)
* Goldman Predicts ‘Bounce Back’ Year for Consumer Staples in 2022
* Goldman Predicts ‘Bounce Back’ Year for Consumer Staples in 2022
* Inditex 9M Sales Strong, Margins Slightly Lower, RBC Says (+)
* Getlink, Neoen, Fugro Among Potential M&A Targets in 2022: Oddo (+)
- Rio Tinto (RIO1 TH) +1.4%
- Watch European Miners as Iron Gains on China Production Forecast
- Nibe (NJB TH) +1.1%
- Rheinmetall (RHM TH) -0.9%
- Norsk Hydro (NOH1 TH) -0.9%
- Equinor (DNQ TH) -0.9%
- Equinor ASA: Equinor’s share saving plan allocates shares
- KBC Group (KDB TH) -1%
- Shell (R6C TH) -1%
- Brent Expected to Be Above $70 a Barrel at End-2022: BI Survey
- Endesa (ENA TH) -1.3%
- EU Power-Price Momentum to Extend in 2022 on Demand, Fuel Costs
- Telefonica (TNE5 TH) -1.4%
- Prosus (1TY TH) -1.4%
- BE Semiconductor (BSI TH) -1.5%
- BE Semiconductor Rated New Underweight at Morgan Stanley
- Colruyt (EFC1 TH) -4.5%
- Colruyt 1H Gross Margin Misses Estimates
DAX:
- No major movers
MDAX:
- Aixtron (AIXA TH) +0.9%
- Aixtron Reinstated Equal-Weight at Morgan Stanley; PT 19 euros
- Varta (VAR1 TH) -1%
SDAX:
- Nordex (NDX1 TH) +1.5%
- Schaeffler (SHA TH) -1.2%
Asian stocks were mixed Wednesday and U.S. equity futures were steady as traders braced for a faster withdrawal of Federal Reserve stimulus and evaluated signs of slowing Chinese economic growth.
Japanese shares gained while China and Hong Kong fluctuated. Chinese data ranging from new home prices to investment and retail sales suggested slowing growth amid a deepening property market slump and Covid disruptions.
Meanwhile, initial lab findings indicated that China’s Sinovac shot -- one of the most widely used in the world -- doesn’t provide sufficient antibodies to neutralize the omicron virus variant. Some 2.3 billion doses of the vaccine have been administered, mostly in China and the developing world.
U.S.-China tension also continues to bubble: the Biden administration is considering imposing tougher sanctions on Semiconductor Manufacturing International Corp., China’s largest chipmaker. The Financial Times reportedthe U.S. will add eight more Chinese companies to an investment blacklist.
S&P 500, Nasdaq 100 and European futures edged up. Treasury yields and the dollar pared gains. Technology shares led a Wall Street drop Tuesday as investors soured on more richly valued stocks ahead of the Fed policy decision.
The Fed on Wednesday is set to unveil a quicker tapering of bond purchases, paving the way for interest-rate hikes next year as high inflation rattles the economy.
Elsewhere, oil fell for a third day. The International Energy Agency said the global market had already returned to surplus. Moreover, mobility curbs to tackle omicron risk hurting demand.
A bill to raise the U.S. debt ceiling by $2.5 trillion headed to President Joe Biden for his signature after being cleared by lawmakers.
Nikkei +0.10% Hang Seng -0.86% CSI -0.89% Shanghai -0.43% Shenzen -0.67%
Eur$ 1.1272 CNH 6.3700 CNY 6.3641 JPY 113.71 GBP 1.3246 CHF 0.9235 RUB 73.8681 TRY 14.5674 WTI$ 69.86 -1.2% Gold 1,769.43 -0.80% BTC 48,250 -60 ETH 3,870 +15
S&P -0.03%% Nasdaq -0.04% EuroStoxx -0.02% FTSE -0.15% Dax +0.04% SMI -0.23%
Macro :
- Italy May Extend Stronger Anti-Takeover Powers for 12 Months: MF
- U.S. Debt Ceiling Increase of $2.5 Trillion Passed by Senate
- ECB Forecasts Show Inflation Below 2% Target After Next Year
- ECB Forecasts Show Inflation Below 2% Target After Next Year
- Goldman Predicts ‘Bounce Back’ Year for Consumer Staples in 2022
Keep an eye on :
Keep an eye on :
- AMUN FP : Amundi to Sell About 4% of SBI FMPL Capital as Part of IPO
- AML LN : Aston Martin Union Workers Threaten to Strike Over Pensions
- BPME IM : BPER Banca Submits Non-Binding Offer for Acquisition of Carige
- BPME IM : BPER Banca Submits Non-Binding Offer for Acquisition of Carige
- BC IM : Brunello Cucinelli to End 2021 With Sales up Almost 30%
- CINE LN : Cineplex Says Court Awards C$1.24b Damages in Cineworld Case
- COLR BB : Colruyt 1H Gross Margin Misses Estimates
- ACA FP : Credit Agricole Announces End of EU500M Buyback Program
- DATA LN : GlobalData Buys LMCA Holdings, LMCI Holdings; No Price Disclosed
- DTE GY : Deutsche Telekom Poised to Extend CEO’s Contract: Handelsblatt
- EQT SS : EQT Fund Weighing Sale or Listing for Facile.it Platform: Sole
- EXS SS : Exsitec Holding Holder Syntrans Offers 800,000 Shares, Offered @ SEK190/Share
- HMB SS : *H&M 4Q SALES SEK56.81B, EST. SEK57.08B
- IAG LN : Iberia, Air Europa Temporarily Suspend Deal: EL Confidencial
- ITX SM : Inditex 9M Ebitda EU5.43B Vs. EU3.33B Y/y
- IDR SM : Sapa Agrees to Buy About 5% of Indra from Alba at EU10.28/Share (closed 10,56)
- IMCD NA : IMCD Supervisory Board Nominates CEO for Another Two Years
- IVACC SS : Intervacc Says Horse Vaccine to Enter Market in 1Q; Shares Gain
- INCY US : Incyte’s Ruxolitinib Cream SNDA Accepted With Priority Review
- KAR SS : Karnov Group Offers Up to 9.83m Shares, Offered @ SEK60.4/Share
- MTEC LN : Made Tech Group Says Performance is in Line With Expectations
- MIDW LN : Midwich Sees Earnings Materially Ahead of Previous Expectations
- ONTEX BB : Ontex Cuts FY Adjusted Ebitda Margin Forecast
- PTEC LN : *PLAYTECH-BACKED CALIENTE IN $2.5B MERGER TALKS WITH TEKKORP:SKY
- ROG SW : Roche Starts Infectious Disease Tests on Cobas 5800 System
- SAN FP : Sanofi, GSK Delay Phase 3 Covid Vaccine Results Until 1Q 2022
- SFER IM : Salvatore Ferragamo Executive Vice Chairman Norsa Resigns
- TNG FP : Transgene Says Astra Exercised License Option for Invir.IO Virus
- VIE FP : Veolia Gets Conditional European Approval for Suez Acquisition
>>> Up
* Bpost Raised to Overweight at Barclays; PT 10 euros
* Cibus Nordic Raised to Buy at Pareto Securities; PT 300 kronor
* Dustin Raised to Buy at Handelsbanken; PT 130 kronor
* Eurofins Scientific Raised to Buy at Stifel; PT 130 euros
* Jumbo Raised to Buy at HSBC; PT 17.50 euros
* Jumbo Raised to Buy at HSBC; PT 17.50 euros
* Tullow Raised to Sector Perform at RBC; PT 90 pence
* UniCredit Raised to Market Perform at KBW; PT 15.40 euros
>>> Down
>>> Down
* Aker BP Cut to Sector Perform at RBC; PT 275 kroner
* DCC Cut to Underweight at Barclays; PT 5,550 pence
* Harbour Energy PLC Cut to Sector Perform at RBC; PT 480 pence
* Harbour Energy PLC Cut to Hold at Berenberg; PT 350 pence
* Lundin Energy Cut to Underperform at RBC; PT 290 kronor
* Lundin Energy Cut to Underperform at RBC; PT 290 kronor
* PostNL Cut to Equal-Weight at Barclays; PT 4 euros
* SIG Combibloc Cut to Underweight at Barclays
* Umicore Cut to Hold at HSBC; PT 36 euros
>>> Initiation
>>> Initiation
* Aixtron Reinstated Equal-Weight at Morgan Stanley; PT 19 euros
* Aker Carbon Capture Rated New Sell at SpareBank; PT 15 kroner
* BE Semiconductor Rated New Underweight at Morgan Stanley
* Daimler Truck Holding Rated New Buy at Deutsche Bank
* Daimler Truck Holding Rated New Buy at Deutsche Bank
* Empiric Student Rated New Buy at Liberum; PT 110 pence
* Pod Point Group Rated New Equal-Weight at Barclays; PT 250 pence
>>> Call
* Goldman Predicts ‘Bounce Back’ Year for Consumer Staples in 2022
>>> Call
* Goldman Predicts ‘Bounce Back’ Year for Consumer Staples in 2022
Will Accor put the sparkle back into Parisian cabaret?
Future of the famous Lido on Champs-Elysées in doubt after purchase by hotel group
For almost 75 years the Bluebell Girls have kicked up a storm at the Lido Cabaret on the Champs-Elysées. But the future of Paris’s celebrated showgirl troupe may hang in the balance after news that hotel group Accor is to buy the iconic venue from catering services company, Sodexo.
The first question that springs to mind after the news, first revealed by France’s Les Echos, is what on earth was Sodexo doing with the Lido in the first place? The two brands couldn’t be more different — one is a feast of feathers, diamanté costumes and, let’s be honest, partial nudity. The other is a provider of the office canteen cuisine we all love to hate.
The second question might be, what on earth is Accor doing buying the Lido? No matter how glorious the show and talented the artists, isn’t there something distinctly passé about the concept? How do bare-breasted dancers fit in with a modern, global brand such as Accor?
But scantily clad dancers have been integral to Paris’s great cabarets for more than a century and the Lido’s statuesque Bluebell Girls, with their feathered headdresses and glittering costumes, are its trademark.
In recent years the Lido has struggled, however. Terrorism, national strikes, and now Covid have all taken their toll on the international tourism that delivers at least 50 per cent of the Lido’s clientele.
There has also been an image problem. Some six years ago, Sodexo invested roughly €25m to modernise the programme and the premises. The aim was to boost annual turnover from €38m to €50m and double the audience to 1m within 3 years, according to reports in Les Echos. Paris Merveilles, the new show created by former Cirque du Soleil director Franco Dragone, was indeed more modern, using cutting edge staging technology, but it drew fire from cabaret aficionados for its paucity of feathers, the introduction of hip-hop sounds into the musical numbers and a lead singer covered in tattoos. “Sodexo did not understand the DNA of the Lido,” says one longtime cabaret owner.
Insiders insist many shows continued to sell out — at least when there were no strikes or pandemics. If so, maybe there is a problem with its pricing power.
The question now is why should a hotel group fare any better? “When you consider Accor’s knowledge of dynamic pricing and inventory management from their hotels business, moving into theatre seat sales is potentially a logical extension of their brand,” says Robin Cantrill-Fenwick, chief executive of cultural consultancy Baker Richards. “But the biggest question mark for me is how they plan to deliver high quality theatrical productions befitting the space.”
And cabaret does not come cheap. In 1999, the Moulin Rouge spent €8m developing its show Féerie and its reputation has been boosted by the 2001 film starring Nicole Kidman and Ewan McGregor.
Accor argues that the Lido will “expand its augmented hospitality strategy offering unique new experiences to its customers as well as members of its loyalty program”.
But does Accor need to buy the lossmaking Lido to offer its spectacle to their clients? Surely this could be achieved more cheaply through an exclusive partnership or joint venture.
That said, there may be opportunities to expand the Lido brand, which still has some cachet. Evelina Girling, founder of the London Cabaret Club, says hotels have expressed interest in putting on cabaret shows. Her company is also about to open a show in Dubai. Finally, Accor has a record of taking iconic brands and extending the theme to hotels, such as the Orient Express. Why not a Lido chain?
But Accor may be planning something even more radical. According to one person with knowledge of the subject, Parisian theatre director Jean-Luc Choplin has been identified as the Lido’s new boss. Choplin has a passion for Broadway musicals. Paris is awash with rumours that he will transform the Lido into a Broadway-style musical theatre.
“Musical theatre is a huge driver of commercial theatre revenue,” says Cantrill-Fenwick. But that too takes heavy investment.
What this means for the Bluebell Girls is unclear. If Accor’s ownership signals the end of the Lido as a full-time cabaret, that would be bad news for the whole sector, says Philippe Lhomme, head of the national cabaret association, Camulc, and owner of another, more select Parisian venue, Crazy Horse. “It is important there are a number of cabarets to maintain this tradition,” he says. “Paris is cabaret.”