Gapping up
In reaction to strong earnings/guidance:
- OLLI +11.4%, PLAB +7.5%, VRA +6.7%, PLAY +1.9%
Other news:
- XERS +11.1% ( reports "positive" topline results from the in-clinic stage of the Phase 2 study of its developmental ready-to-use glucagon in patients at risk of postprandial hypoglycemia following bariatric surgery)
- CHH +9.5% (to join S&P MidCap 400)
- XCUR +8.7% (provides update from Phase 1b/2 trial with AST-008 in patients with solid tumors, says preliminary data show signs of activity in patients with Merkel cell carcinoma)
- WRTC +7.2% (President Tom Smith is scheduled to be interviewed live tomorrow morning at 8:50 a.m. ET in-studio on Morning's With Maria on the Fox Business Network program)
- BCRX +4.9% (submits new drug application to the FDA for approval of oral, once daily berotralstat for the prevention of hereditary angioedema attacks)
- QFIN +4.7% (informed by Hongyi Zhou and certain management that they have reached an agreement with FountainVest Partners to jointly invest up to $60 mln to purchase shares in the next twelve months)
- PCG +2.8% (continued strength)
- LDOS +2.6% (awarded $6.5 bln Defense Information Systems Agency contract)
- PACK +2.2% (prices registered underwritten public offering of 15,384,616 shares of its Class A common stock at a public offering price of $6.50 per share)
- PLT +1.2% (to join S&P SmallCap 600)
Analyst comments:
- FTV +1.6% (upgraded to Overweight at Morgan Stanley)
- REAL +1.4% (initiated with a Buy at DA Davidson)
ARWR US - Files IND for Phase 1b Study of ARO-HIF2 for Treatment of Clear Cell Renal Cell Carcinoma
Announced that it has submitted an Investigational New Drug (IND) application to the U.S. Food and Drug Administration (FDA) for a Phase 1b adaptive dose-finding clinical study of ARO-HIF2, the company’s investigational RNA interference (RNAi) therapeutic being developed as a treatment for patients with clear cell renal cell carcinoma (ccRCC).Javier San Martin, M.D., chief medical officer at Arrowhead, said: “ARO-HIF2 is Arrowhead’s first TRiM™ enabled investigational RNAi therapeutic to target a cell type outside of the liver. Clear cell renal cell carcinoma, or ccRCC, is one of the most common forms of kidney cancer. Most patients with ccRCC have a mutation in the Von Hippel-Lindau gene, rendering them unable to degrade HIF-2a, which leads to accumulation during tumor hypoxia and promotes tumor growth. We believe this makes HIF-2a an attractive target for an RNAi-based intervention.”Pending regulatory review, the company intends to initiate AROHIF21001 (NCT04169711), a Phase 1b adaptive design dose-finding clinical study in patients with advanced ccRCC to evaluate the safety of ARO-HIF2 and to determine the recommended Phase 2 dose. Additional secondary objectives include the assessment of pharmacokinetics and efficacy, based on Response Evaluation Criteria in Solid Tumors (RECIST). An exploratory objective for AROHIF21001 will be gene target knockdown using tumor biopsy.
Early premarket gappers
- Gapping up:
- WRTC +12.5%, XERS +11%, OLLI +9.6%, CHH +9.5%, PACK +6.5%, QFIN +3.5%, LDOS +2.6%, PLAY +2.5%, PLAB +1.6%, REAL +1.4%, PCG +1.3%, PLT +1.2%
- Gapping down:
- AQST -15.4%, GME -14%, KIDS -7.9%, MDGL -7.1%, RCKT -6.9%, AGX -6.2%, MNTA -3.4%, PMT -2.9%, DBX -2.3%, DOOO -2.2%, HD -1.9%, UPS -0.8%, PI -0.7%, GLNG -0.7%
Goldman’s WeWork bailout loan close to amount of Adam Neumann’s exit package
Goldman Sachs is stepping in to bail out WeWork — and the size of the new loan looks queasily familiar.
The banking behemoth headed by David Solomon has put together a credit line for the flailing office-sharing startup worth $1.75 billion, sources said — just slightly over the value of a sickening, $1.7 billion golden parachute that was given to disgraced founder Adam Neumann.
The October payout to Neumann — which was soon followed by the layoffs of 2,400 WeWork employees — sparked outrage, as allegations of Neumann’s self-dealing and erratic behavior sent WeWork into a tailspin.
“This has nothing to do with [the] Neumann payout,” a Goldman source insisted. “This is a letter of credit facility for [WeWork] to be able to [rent new space from] landlords.”
Indeed, Goldman insiders already appear to be getting touchy about the new credit line, which was first reported by Bloomberg on Monday.
JPMorgan — whose chief executive, Jamie Dimon, took heat not only for botching WeWork’s IPO, but also for his cozy relationship with Neumann — had recently refused to pack a parachute for Neumann in a $5 billion bailout package it had offered WeWork, according to reports.
With Neumann still controlling WeWork’s board at the time, JPMorgan’s package was spurned.
“JPMorgan will be 100% driving some of these narratives on the street,” a source close to Goldman said when asked about the $1.7 billion figure. “They are bitter they are no longer involved.”
Indeed, Goldman CEO Solomon is now the key partner to WeWork’s owner, SoftBank CEO Masayoshi Son, in bailing out the beleaguered office-sharing company.
Nevertheless, “That number is laughably close to $1.7 billion,” said one investment banker, referring to the outrageous package Neumann got. “Goldman Sachs couldn’t get that to $2 [billion]?”
A JPMorgan source said Goldman’s new credit line doesn’t fundamentally change the past relationships between the banks, WeWork and Softbank.
“Goldman always worked with SoftBank on this and JPMorgan dealt directly with WeWork,” said a JPMorgan insider.
Goldman likely won’t find other banks to partner with it on financing the WeWork restructuring, which is still seen as a risky deal despite the company taking a painful markdown. Still, it won’t be going it alone, said Odeon Capital Group analyst Dick Bove.
“Hedge funds buy this type of stuff and private equity funds buy it, too,” Bove said. “Generally speaking, banks won’t get involved in something like this, but it will be a successful effort on Goldman’s part.”
Spokespeople for Goldman and JPMorgan declined to comment.
A maxed-out version of Apple’s latest desktop computer costs more than a souped-up Tesla.
The new Mac Pro released Tuesday — whose design has been likened to a giant cheese grater by tech geeks on Twitter — tops out at nearly $60,000 for customers who opt for all the bells and whistles.
By comparison, the Performance version of the Model 3 Sedan, which features a carbon-fiber spoiler and top speed of 162 mph, sells for $56,990.
The Mac Pro had already turned heads when it was announced in June with a starting price of $5,999.
At the time, Apple had announced that the Mac Pro would be made in China. But in September it decided to keep production in Austin, Texas after US trade regulators approved 10 requests for tariff exemptions for computer parts.
The Mac Pro is designed to be paired with Apple’s new $4,999 Pro Display XDR monitor, which can be upgraded to a nano-texture glass finish for an extra $1,000. The monitor is mounted on a “Pro Stand” that costs $999.
But the real sticker shock comes for customers who are itching for power.
Available upgrades include an additional $10,800 for beefed-up Radeon Pro Vega II Duo graphics cards, as well as $25,000 for 1.5 terabytes of DDR4 ECC memory.
Also available is a stainless steel frame with wheels which costs $400, enabling the 40-pound super-computer to be wheeled around.
Adding a Magic Mouse and Magic Trackpad, as well as the display and Pro Stand, brings the grand total to $59,746.
Luckily, Apple is advertising a promotion for its Apple Card which gives customers 6-percent back on purchases at its store through December. Putting down the titanium credit card would net you $3,584.76 in cash back.
Shares of Apple ended up 0.6 percent on Tuesday, at $268.48.
Paul Volcker issues warning for America in final essay
Donald Trump’s attacks on the Fed are helping to undermine faith in democratic institutions
This piece was written in September, three months before the author’s death on December 8, as the afterword to the forthcoming paperback edition of his autobiography.
By the late summer of 2018, it was already clear that the US and the world order it had helped establish during my lifetime were facing deep-seated political, economic, and cultural challenges.
Nonetheless, I drew reassurance from my mother’s reminder that the US had endured a brutal civil war, two world wars, a great depression, and still emerged as the leader of the “free world”, a model for democracy, open markets, free trade, and economic growth. That was, for me, a source of both pride and hope.
Today, threats facing that model have grown more ominous, and our ability to withstand them feels less certain. Increasingly, by design or not, there appears to be a movement to undermine Americans’ faith in our government and its policies and institutions. We’ve moved well beyond former president Ronald Reagan’s credo that “government is the problem”, with its aim of reversing decades of federal expansion.
Today we see something very different and far more sinister. Nihilistic forces are dismantling policies to protect our air, water, and climate. And they seek to discredit the pillars of our democracy: voting rights and fair elections, the rule of law, the free press, the separation of powers, the belief in science, and the concept of truth itself.
Without them, the American example that my mother so cherished will revert to the kind of tyranny that once seemed to be on its way to extinction — though, sadly, it remains ensconced in some less fortunate parts of the world.
When I was writing my book, I observed that President Donald Trump had not attacked the independent US Federal Reserve, for which I was grateful. To say that is no longer true would be an understatement.
Not since just after the second world war have we seen a president so openly seek to dictate policy to the Fed. That is a matter of great concern, given that the central bank is one of our key governmental institutions, carefully designed to be free of purely partisan attacks.
I trust that the members of the Federal Reserve Board itself, the members of Congress responsible for Fed oversight, and indeed the public at large, will maintain the Fed’s ability to act in the nation’s interest, free of partisan political purposes.
Monetary policy is important, but it cannot by itself sustain global leadership. We need open markets and strong allies to support economic growth and the prospects for peace. Those constructive American policies have been a large part of my life. Instead, confidence in the US is under siege.
Seventy-five years ago, Americans rose to the challenge of vanquishing tyranny overseas. We joined with our allies, keenly recognising the need to defend and sustain our hard-won democratic freedoms. Today’s generation faces a different, but equally existential, test. How we respond will determine the future of our own democracy and, ultimately, of the planet itself.
There is a need to “keep at it”. It cannot be set aside.
The writer was chairman of the Board of Governors of the US Federal Reserve System from 1979 to 1987. Christine Harper co-wrote this piece as well as their book ‘Keeping At It: The Quest for Sound Money and Good Government’. The paperback edition is scheduled for publication next year by PublicAffairs
Tui braced for hit of up to €400m next year from 737 Max groundings
World’s largest tour operator says summer trade will be impacted if ban not lifted by February
Tui, the world’s largest tour operator, said that the grounding of the Boeing 737 Max fleet could cost the company up to €400m next year if it is not returned to service by April.
The Anglo-German holiday group said that if the ban against flying the Boeing 737 Max aeroplanes, which has been in place since March following two fatal crashes of the model, remained beyond February next year, Tui would not be able to prepare to fleet to fly from April for its summer high season.
The grounding of the planes has cost the company €293m in lost earnings this year.
Tui was the UK’s biggest operator of 737 Max Model 8 with 15 in its fleet and a total of 72 ordered from the US aircraft manufacturer. In an interview with the Financial Times in November, chief executive Friedrich Joussen said that, despite the safety issues with the planes that have emerged since 737 Max was grounded, Tui would fly it once it returned to service as “it will be potentially the most checked aircraft”.
Should the planes be declared fit to fly before February, the company said that it would only have a €130m impact on earnings.
Tui said that earnings in the year to the end of September had dropped 24.5 per cent to €893m compared with 2018 due both to the grounding of the 737 Max jets and continued Brexit uncertainty impacting customer bookings. Turnover increased 2.5 per cent to €18.9bn but remained behind consensus forecast of €19.4bn.
The demise of Tui’s rival Thomas Cook has been a boost to the company, allowing it to grow its capacity and raise prices. It previously said that it has added an additional 2m airline seats to its summer availability next year as well as an extra 135 hotels since Thomas Cook collapsed in September.
However, analysts have said that the upside for Tui may be limited as much of the capacity left by Thomas Cook in the market will be filled by lower cost rivals such as On The Beach and Jet2. The low cost airline easyJet also launched its own holiday business last month.
In a bid to differentiate itself, Tui has invested in its own hotels and cruise ships as well as its online booking service, which allows customers to personalise holidays down to individual room choice.
“Tui is financially strong, economically robust and has made major investments in hotels, cruises and new digital businesses since 2014. The second stage of the transformation, launched to transform Tui to a digital group, will change our company considerably stronger than all steps taken over the past five years,” Mr Joussen said.
Rio Tinto (RIO1 TH) +0.7%
Iron Ore Bulls Take On Skeptics as Prices Push Higher Into $90s
Reckitt (3RB TH) +0.6%
UniCredit (CRIN TH) -0.6%
Osram (OSR TH) -0.6%
Airbus (AIR TH) -0.9%
Airbus Should Focus on Investment, Financial Strength: Jefferies
Norsk Hydro (NOH1 TH) -1.5%
Norsk Hydro Cut to Sell at Goldman; PT 27 kroner
Bechtle (BC8 TH) -1.6%
Bechtle Cut to Hold at HSBC; PT 120 euros
Telefonica Deutschland (O2D TH) -2%
Telefonica Deutschland FY Div. Falls to EU0.17 Vs EU0.27/Share