Gapping down
In reaction to earnings/guidance:
- ZY -73.9% (no longer expects product revenue in 2021; CEO steps down), CDLX -20.5%, LPSN -9.5%, OSUR -8.4%, AYX -8.1%, PSN -7.7%, HTA -6.9% (also CEO resigns; also raises dividend slightly), MRCY -6.5%, AKAM -5.9%, WTI -5.4%, WTI -5.4%, SPWR -4.8%, VIRT -4.7%, KAR -4.2%, ODP -3.9%, CVGW -3.9%, NCR -3.8%, MTCH -3.5%, SKLZ -3.5%, INFN -3%, UNM -2.8%, GM -2.7%, H -2%, CPE -1.7%, HPP -1.3%, TT -1.3%, VMC -1.3%, LUMN -1.2% (LUMN also to sell local incumbent carrier operations in 20 states to APO for $7.5 bln), FMC -1.2%, TISI -1.1%, CAMT -1%, ETR -1%, CVS -0.9%, KTOS -0.8%, AMGN -0.8%, TM -0.8%, MPC -0.8%, PACB -0.7%, LMT -0.7% (CFO retires; reaffirms FY21 sales guidance, lowers EPS due to charge impact; announces reduction of pension obligation by $4.9 bln), BWA -0.7%
Other news:
- TELL -11.7% (prices offering of 35 mln shares of common stock)
- CHNG -8.7% (DOJ may sue to block UNH's acquisition of CHNG, according to The Information)
- UTL -6.1% (stock offering)
- OPCH -4.9% (prices secondary offering of 18 mln shares of common stock at $20.25 per share)
- ZI -1.9% (prices secondary offering of 27 mln shares of common stock at $54.78 per share)
- RNA -1.6% (prices offering of 8 mln shares of common stock at $18.00 per share)
- AAL -1.3% (SAVE and ALL cancel hundreds of flights amid staff shortages, according to Bloomberg)
Analyst comments:
- OCFT -6.2% (downgraded to Equal-Weight from Overweight at Morgan Stanley)
- SWI -0.5% (downgraded to Hold from Buy at Berenberg)
Gapping up
In reaction to earnings/guidance:
- GBT +15.2%, INSP +14.3%, CERS +11.3%, COUR +10.7%, NVTA +10.5%, NPTN +9.9%, HZNP +9.3%, BXC +9.1%, SPNS +8.2%, TUP +7.4%, GDOT +7%, PAYC +6.4%, DVA +5.5%, VECO +5.3%, JLL +5.3%, ATVI +5.2%, UTHR +5.2%, GEO +4.5%, CLH +4.1%, NEWR +3.9%, MTOR +3.7%, SBGI +3.7%, OI +3.5%, PUMP +3.5%, LYV +3.4%, TX +3.3%, WK +3.3%, RNG +3.2%, RGA +3.1%, DENN +3.1%, BNFT +2.9%, SRC +2.8%, CZR +2.5%, SKY +2.4%, SPR +2.3%, IOSP +2.1%, FNF +2% (also raises dividend and announces 25 mln share repurchase authorization), XP +2%, SKT +1.9%, LL +1.9%, AFG +1.7%, NMIH +1.6%, CRTO +1.6%, MCHP +1.4% (also raises dividend), SPT +1.4%, EDIT +1.4%, CIM +1.3%, FRG +1.2%, RDN +1.2%, SMG +1.2%, ABC +1.1%, EXC +1.1%, FDP +1%, LYFT +0.9%, CAR +0.9%, MAC +0.9%, APAM +0.8%, PSA +0.8%, QUAD +0.8%, CDW +0.8%
Other news:
- BYSI +193.4% (reports top-line results from DUBLIN-3 trial)
- LMRK +20.4% (receives $16.25/unit asset purchase proposal from Melody Investment Advisors)
- OBSV +5.2% (announces two cornerstone publications describing clinical trials of Nolasiban for improving pregnancy and live birth outcomes following IVF)
- MGM +3.9% (entered into agreement with VICI Properties (VICI) and MGM Growth Properties (MGP) to redeem majority of MGP units held by MGM for $43/unit; MGP to be acquire by VICI in stock-for-stock deal)
- INVE +3.7% (CFO steps down)
- AMSC +3% (announces $21 mln of new energy power system orders)
- NRXP +3% (signed an agreement with MannKind Corporation (MNKD) to develop a dry powder formulation of ZYESAMI)
- MCFE +2.6% (declares special cash dividend of $4.50/sh)
- RIGL +1.6% (files for $100 mln mixed securities shelf offering)
- NOG +1.6% (increases dividend)
- CWH +1.5% (increases stock buyback program by $125 mln)
- AFRM +1.2% (follow up to report that co will partne with Apple for buy now, pay later service)
- PFE +1.2% (top-line results from the Phase 2b/3 ALLEGRO trial)
Analyst comments:
- BHG +3.8% (upgraded to Buy from Neutral at Citigroup)
- BJRI +2.8% (upgraded to Buy from Hold at Deutsche Bank)
- UAA +2.8% (upgraded to Overweight from Neutral at JP Morgan)
- SHEN +2.2% (upgraded to Mkt Perform from Underperform at Raymond James)
Delta infections among vaccinated likely contagious; Lambda variant shows vaccine resistance in lab
Aug 2 (Reuters) - The following is a roundup of some of the latest scientific studies on the novel coronavirus and efforts to find treatments and vaccines for COVID-19.
Delta breakthrough infections likely contagious
Among people infected by the Delta variant of the coronavirus, fully vaccinated people with "breakthrough" infections may be just as likely as unvaccinated people to spread the virus to others, new research suggests. The higher the amount of coronavirus in the nose and throat, the more likely the patient will infect others. In one Wisconsin county, after Delta became predominant, researchers analyzed viral loads on nose-and-throat swab samples obtained when patients were first diagnosed. They found similar viral loads in vaccinated and unvaccinated patients, with levels often high enough to allow shedding of infectious virus. "A key assumption" underlying current regulations aimed at slowing COVID-19 transmission "is that those who are vaccinated are at very low risk of spreading the virus to others," said study coauthor Katarina Grande of Public Health Madison & Dane County in Madison, Wisconsin. The findings, however, indicate "that vaccinated people should take steps to prevent the spread of the COVID-19 virus to others," she added. In a separate study from Singapore, researchers found that while Delta viral loads were similar in vaccinated and unvaccinated patients, the viral loads decreased faster in the vaccinated group. The Wisconsin and Singapore studies were both posted on Saturday on medRxiv ahead of peer review.
Lambda variant shows vaccine resistance
The Lambda variant of the coronavirus, first identified in Peru and now spreading in South America, is highly infectious and more resistant to vaccines than the original version of the virus the emerged from Wuhan, China, Japanese researchers have found. In laboratory experiments, they found that three mutations in Lambda's spike protein, known as RSYLTPGD246-253N, 260 L452Q and F490S, help it resist neutralization by vaccine-induced antibodies. Two additional mutations, T76I and L452Q, help make Lambda highly infectious, they found. In a paper posted on Wednesday on bioRxiv ahead of peer review, the researchers warn that with Lambda being labeled a "Variant of Interest" by the World Health Organization, rather than a "Variant of Concern," people might not realize it is a serious ongoing threat. Although it is not clear yet whether this variant is more dangerous than the Delta now threatening populations in many countries, senior researcher Kei Sato of the University of Tokyo believes "Lambda can be a potential threat to the human society."
Third mRNA dose may boost antibody quantity, but not quality
Among fully vaccinated people who never had COVID-19, getting a third dose of an mRNA vaccine from Pfizer (PFE.N)/BioNTech or Moderna (MRNA.O) would likely increase levels of antibodies, but not antibodies that are better able to neutralize new virus variants, Rockefeller University researchers reported on Thursday on bioRxiv ahead of peer review. They note that in COVID-19 survivors, the immune system's antibodies evolve during the first year, becoming more potent and better able to resist new variants. In 32 volunteers who never had COVID-19, they found that antibodies induced by mRNA vaccines did evolve between the first and second shots. But five months later, vaccine-induced antibodies were "equivalent" to those seen after the second dose, with "little measurable improvement" in the antibodies' ability to neutralize a broad variety of new variants, said coauthor Michel Nussenzweig. Therefore, he said, giving those individuals a third dose of the same vaccine would likely result in higher levels of antibodies that remain less effective against variants. "At the moment, the vaccine remains protective against serious infection," Nussenzweig said. "Should we learn that efficacy is indeed waning for serious infection, which is not really the case to date," then a booster dose of "whatever is available" might become appropriate, he added. Should an updated vaccine become available that protects against specific variants, "then that would be the choice."
Majority of U.S. childcare providers are vaccinated
U.S. childcare providers have higher COVID-19 vaccination rates than U.S. adults in general, a new study suggests. Researchers sent surveys in May and June to nearly 45,000 childcare providers and received responses from 48%. Overall, 78% of respondents said they were fully vaccinated, compared with a rate of about 60% in the general U.S. population. Roughly 73% of home-based caregivers said they were vaccinated, compared to nearly 80% of those working in facilities. Rates varied widely by state, from a low of 54% in Wyoming to a high of 89% in Massachusetts. The patterns of relative differences in vaccination rates were similar to what is seen in the general population, the researchers reported on Sunday on medRxiv ahead of peer review, with younger, lower-income and Black or African-Americans reporting the lowest vaccination rates. "Efforts to promote COVID-19 vaccine uptake among childcare providers take on added significance when considering the emergence of the more transmissible Delta variant," the authors said. With young children ineligible for COVID-19 vaccination, "the limiting factor in ensuring an adequate supply of childcare services will be contingent on protecting the personal health of childcare providers," they said.
SoftBank acquires $5bn stake in Swiss drugmaker Roche
Deal struck through unit of Japanese technology group that was behind ‘Nasdaq whale’ trade
Please use the sharing tools found via the share button at the top or side of articles. Copying articles to share with others is a breach of FT.com T&Cs and Copyright Policy. Email licensing@ft.com to buy additional rights. Subscribers may share up to 10 or 20 articles per month using the gift article service. More information can be found at https://www.ft.com/tour.
SoftBank has acquired a $5bn non-voting stake in Swiss drugmaker Roche through its unit that was responsible for the “Nasdaq whale” trade, according to two people with knowledge of the transaction.
The architect of the investment was Akshay Naheta, the former Deutsche Bank trader who runs SB Northstar, a vehicle set up last year to manage the Japanese technology investor’s public equity trades.
Naheta has been behind some of SoftBank’s most controversial investments. These include the so-called Nasdaq whale, which bought billions of dollars of US equity derivatives in a series of trades that stoked a rally in tech stocks, and the scandal-ridden German payments company Wirecard.
The Roche deal, which was first reported by Bloomberg, comes just months after SoftBank founder Masayoshi Son told investors he would scale back investments by SB Northstar after the unit racked up $5.6bn in derivative losses since it was set up in July 2020.
The decision to buy a stake in a large pharmaceutical company marks a shift away from SB Northstar’s recent investments, which have been focused on tech and earlier stage biotech companies. A person briefed on the matter said the move signalled Naheta’s attempts to diversify SB Northstar’s portfolio.
SB Northstar’s investments, which are partly funded by Son’s personal money, have raised questions within SoftBank and among investors about the unit’s strategy and due diligence process.
SoftBank’s shares fell 1.1 per cent on Wednesday.
Roche, one of world’s largest drugmakers by revenue, focuses on diagnostics, cancer drugs and treatments for immune conditions, among other diseases. Some of those medicines deploy a targeted, or “precision medicine” approach, which Roche has developed with its own data and those it has acquired.
Sales at the company, one of the “Big Four” diagnostic makers worldwide, have increased in the past year on demand for its Covid-19 tests, though it does not make vaccines.
In the first half of 2021, diagnostics sales grew 51 per cent to make up about a third of the group’s overall revenues of SFr31bn ($34bn).
While sales by its pharmaceutical division decreased during the pandemic, the company said last month that the unit had returned to growth, buoyed by a bounceback in routine healthcare.
One of the company’s rheumatoid arthritis drugs, Actemra, has been repurposed to treat severe Covid patients and is recommended by the World Health Organization. Roche has also developed a Covid antibody treatment with US company Regeneron.
Shares in Roche have risen 18 per cent this year.
The Basel-based group is controlled by the Hoffmann-La Roche family, which holds 50.1 per cent of shares. Company disclosures show rival Novartis, which is also based in Basel, owns a third.
After a protracted battle, Roche took over US biotech Genentech in 2009 for $47bn. The latter’s early research and development centre continues to operate independently within Roche out of San Francisco, where the pharma company’s US operations are headquartered.
Roche and SoftBank declined to comment. Naheta was not immediately available for comment.
Spain’s top football league agrees to €2.7bn private equity investment
Barcelona and Real Madrid set to receive about €260m each if La Liga clubs vote for CVC deal
Please use the sharing tools found via the share button at the top or side of articles. Copying articles to share with others is a breach of FT.com T&Cs and Copyright Policy. Email licensing@ft.com to buy additional rights. Subscribers may share up to 10 or 20 articles per month using the gift article service. More information can be found at https://www.ft.com/tour.
Spain’s top football league has agreed a €2.7bn deal with CVC Capital Partners, marking private equity’s latest attempt to invest in a major European league.
The deal, which has not been agreed by clubs, values La Liga at just over €24.2bn. CVC would take a minority stake in a newly created entity that would manage broadcast, sponsorship and digital rights for La Liga, which runs Spain’s top two football divisions, but would not take over its regulatory powers for the sport.
Under the project, named “La Liga Impulso”, just under €2.5bn of the investment would go directly to clubs over a three-year period, according to two people with knowledge of the deal.
Real Madrid and FC Barcelona, Spain’s most successful clubs, would stand to receive about €260m each, according to one of the people. Barcelona declined to comment. Real Madrid did not immediately respond to inquiries.
Clubs could be asked to vote on the deal as soon as next week, the two people said.
It comes at a time when other top European leagues have ended talks with private equity firms after a backlash about handing over control to an outside group.
Last year, CVC won the backing of some clubs in Italy’s top Serie A league for a similar deal but those talks stalled after opposition from elite teams. In May, Germany’s top football clubs voted to retreat from talks with private equity firms over the sale of a stake in the Bundesliga.
CVC’s La Liga investment would aim to help clubs recover from the financial hit suffered during the pandemic, although a person close to the league insisted the financing was not a rescue package. It would also aim to attract a larger international audience, improve technology and inject some funds into grassroots football in Spain.
CVC declined to comment on the deal.
Barcelona and Real Madrid are expected to play an important role in determining whether the deal is agreed. They have clashed with La Liga over their support for the European Super League, a breakaway competition that would have guaranteed each founding member a “welcome bonus” of €200m-€300m.
Although most of the ESL’s backers withdrew their support within days of its launch after a backlash from fans, the two Spanish clubs are still battling for its future despite strong opposition from Uefa, European football’s governing body, and La Liga.
Investors have targeted sports deals during the pandemic, as leagues and clubs struggle to recover from the loss of revenue from matches that were cancelled or played in empty stadiums.
While some private equity firms own stakes in clubs, such as Silver Lake’s investment in Manchester City’s owner, City Football Group, many are drawn to what they see as a lower-risk bet on the leagues themselves.
CVC, a former owner of Formula One and MotoGP, has snapped up stakes in rugby contests such as the Six Nations, English Premiership and Pro14 and has bought into the International Volleyball Federation. It is planning a $600m tennis deal, and has previously held talks to buy a stake in the San Antonio Spurs, the US basketball team.
La Liga’s top 20 clubs posted total revenues of €3.1bn in the 2019/20 season, which was disrupted by the pandemic, an 8 per cent drop on the previous year, according to Deloitte. Their rivals in the English Premier League posted revenues of €5.1bn.
Real Madrid has eschewed major signings so far this summer, while Barcelona has been forced to cut wages and other costs to comply with La Liga financial regulations that would otherwise prevent the club from registering players in the summer transfer window.
Private equity firm Ares Management has acquired just over a third of Atlético Madrid, last season’s La Liga champions, and backed a €181m capital raise by the club.
Early premarket gappers
- Gapping up:
- CERS +15.8%, LMRK +14.8%, COUR +13.4%, INSP +12.4%, GBT +11.9%, NVTA +11.5%, NPTN +9.9%, BXC +9%, PAYC +7.5%, GDOT +7%, UNM +6.4%, QUAD +6.1%, OBSV +6%, ATVI +5.8%, AMSC +5.7%, TISI +5.5%, VECO +5.3%, LL +4.5%, NEWR +3.9%, INVE +3.7%, PUMP +3.5%, RNG +3.4%, UTHR +3.4%, ETH +3.3%, AFRM +3.3%, WK +3.3%, LSCC +3.2%, RGA +3.1%, DENN +3.1%, CAR +3%, CZR +2.9%, BNFT +2.9%, NMIH +2.7%, CAMT +2.7%, MCFE +2.5%, TX +2.5%, SKY +2.4%, SND +2.4%, IOSP +2.1%, HGEN +2%, FNF +2%, SKT +1.9%, XP +1.8%, AFG +1.7%, NOG +1.6%, VLRS +1.5%, DVA +1.5%, OXY +1.4%, SPT +1.4%, CWH +1.2%, MCHP +1.2%, FRG +1.2%, RDN +1.2%, PACB +1%, LYFT +1%, LYV +1%, FDP +1%
- Gapping down:
- ZY -72.2%, CDLX -20.1%, TELL -11.7%, OSUR -11.3%, LPSN -9.2%, CHNG -9%, HTA -8.1%, AYX -8%, INFN -6.8%, UTL -5.6%, KAR -5.4%, AKAM -5.4%, KTOS -5.2%, SPWR -3.8%, NCR -3.8%, RNA -3.6%, MRCY -3.5%, MTCH -3.1%, RIGL -2.4%, SKLZ -2.1%, ICHR -2.1%, TSLX -1.8%, OPCH -1.6%, H -1.5%, HPP -1.3%, ZI -1.2%, IR -0.9%, SRC -0.8%, NDAQ -0.7%
Apple taps more China suppliers for its latest iPhones
Rise of Chinese assemblers and component makers comes amid tech tensions with US
TAIPEI -- Apple is tapping more suppliers in China for key roles in producing the latest iPhone, a sign that the country's technological competitiveness is continuing to increase despite Washington's attempts to rein in Beijing's tech ambitions.
Chinese electronics maker Luxshare Precision Industry will build up to 3% of the upcoming iPhone 13 series, winning orders away from Taiwanese rivals Foxconn and Pegatron, Nikkei Asia has learned. Apple is slated to produce between 90 million and 95 million of the new iPhones through January.
Luxshare will start building the iPhone 13 Pro -- as the premium model is expected to be called -- this month, according to sources, a major breakthrough for a company that has never produced iPhones on its own. Newcomers to the Apple supply chain normally start out making older iPhone models. Two companies that Luxshare acquired last year, South Korean camera module maker Cowell and metal frame maker Casetek of Taiwan, will also supply key components and parts for this year's new iPhones, sources familiar with the matter said.
"Although Luxshare only makes a small percentage of iPhones this year, we can't let our guard down," said a senior executive at a rival iPhone supplier. "If we don't strengthen our competitiveness, sooner or later they will be the major source."
Apple boasts the world's most complex consumer electronics supply chain, churning out roughly 200 million iPhones, 20 million MacBooks and tens of millions of AirPods a year. The company's notoriously high manufacturing standards mean that any company in its supply chain is seen as being among the best in its field.
The rise of Chinese Apple suppliers comes at the expense of rivals in the U.S., Taiwan, Japan and South Korea, several of whom are either seeing their share of orders shrink or who have dropped out of the Apple supply chain completely.
China's success also comes despite an ongoing U.S. crackdown on Chinese chipmakers, including trade restrictions aimed at blocking their access to vital American tools and technologies.
Hunan-based Lens Technology previously only supplied glass backs and cover glass for iPhones, but this year will also supply metal casings for the first time, Nikkei has learned, thanks to its acquisition last year of a rival's metal frame and casing plants in China.
Meanwhile, China's biggest maker of smartphone camera lenses, Sunny Optical Technology, entered the iPhone supply chain for the first time this year, people familiar with the matter said. The Hong Kong-listed company will supply rear camera lenses, though its share is still small, according to the sources.
Based in Zhejiang Province, Sunny Optical -- a key supplier to China's Xiaomi, Huawei, Oppo and Vivo -- has long been viewed as a key competitor to Largan Precision of Taiwan, the leading maker of premium smartphone lenses and a longtime iPhone supplier. Sunny Optical's revenue nearly tripled from 2016, while its net profit has quadrupled.
BOE Technology will begin supplying premium organic light-emitting diode displays for the iPhone 13 series as soon as next quarter if it receives Apple's approval this quarter, two people familiar with the situation said. It started providing OLED displays for older iPhone models last year.
Beijing sees BOE as the country's best hope for challenging Samsung, the world's largest and most advanced OLED supplier. Apple is also keen to bring the Chinese display maker into the iPhone supply chain as a way of increasing its bargaining power with Samsung.
Several other Chinese companies appeared on Apple's supplier list for the first time last year, including display maker Tianma Micro-Electronics, memory chip maker GigaDevice Semiconductor and Nexperia, owned by China's biggest smartphone assembler, Wingtech Technology.
Wingtech is also in the process of buying the U.K.'s biggest chip plant, Wales-based Newport Wafer Fab, via Nexperia.
Shenzhen Everwin Precision Technology, a rival of Taiwan's Catcher Technology and Foxconn's casing unit, also appeared on the top 200 suppliers list for the first time last year.
Eric Tseng, chief analyst with Isaiah Research, said companies like Luxshare, Goertek, Wingtech and Lens have all been gaining orders in the Apple supply chain recently. The rise of Luxshare -- which started out providing relatively simple components for iPhones just a few years ago -- is likely to be a bargaining chip for Apple against its longtime manufacturing partner Foxconn, he added.
"We foresee Apple's need to diversify its sourcing and manage its costs amid the geopolitical uncertainties that will continue to rise in the coming years, which will give Chinese suppliers a good opportunity to expand shares in the supply chains and create bigger pressure on the existing suppliers," Tseng told Nikkei Asia.
Apple, Luxshare, Lens, BOE and Sunny Optical did not respond Nikkei's Asia's requests for comments as of publication.
>>> Up
* Fortum PT Raised to 30 euros from 23 euros at Berenberg
* Fortum PT Raised to 30 euros from 23 euros at Berenberg
* Sonova Raised to Buy at Bank Vontobel; PT 430 Swiss francs
>>> Down
>>> Down
* Acea Cut to Add at Intesa Sanpaolo; PT 22.80 euros
* Infineon Cut to Hold at Liberum; PT 36 euros
* Legrand Cut to Hold at Berenberg; PT 100 euros
* Pfeiffer Vacuum Cut to Hold at DZ Bank; PT 185 euros (+)
* Prima Industrie Cut to Add at Intesa Sanpaolo; PT 24.30 euros
* Prima Industrie Cut to Add at Intesa Sanpaolo; PT 24.30 euros
* Primary Health Cut to Hold at Panmure Gordon; PT 172 pence (+)
>>> Initiation
* Aberdeen Standard Rated New Outperform at RBC; PT 140 pence
>>> Initiation
* Aberdeen Standard Rated New Outperform at RBC; PT 140 pence
* Cairn Energy Re-Initiated Hold at Peel Hunt; PT 130 pence
* Capita Reinstated Overweight at Barclays; PT 80 pence (+)
* Cherry Rated New Buy at Hauck & Aufhaeuser; PT 48.50 euros
* Delivery Hero Reinstated Buy at Goldman; PT 185 euros
* Hutchmed China ADRs Rated New Buy at China Merchants; PT $54.60
* Just Eat Takeaway Reinstated Buy at Goldman; PT 130 euros (+)
* OX2 Rated New Buy at ABG; PT 81 kronor
* Traton Rated New Buy at LBBW; PT 32 euros
>>> Call
>>> Call
* Fortum, Verbund PTs Upped on Carbon Price Bullishness: Berenberg
* Hugo Boss Trading Update Is ‘Promising,’ Baader Helvea Says (+)
* Legrand in ‘Great Shape,’ But Limited Upside Risk: Berenberg
* Legrand in ‘Great Shape,’ But Limited Upside Risk: Berenberg
* Schaeffler 2Q In Line, Guidance Raised as Expected: Jefferies (+)
* Cyclically Exposed Sectors Post Strongest 2Q Earnings: Bernstein (+)