Gapping down
In reaction to disappointing earnings/guidance:
- ATEN -15.2%, BGG -11.8%, FII -8.9%, INTC -7.5%, BEAT -5.5%, RBS -4.6%, SGEN -4.3%, AAL -4.2%, SIVB -3.8%, NR -3.8%, VCRA -3.6%, MOBL -3.5%, INT -3.4%, FTV -3.1%, PFPT -2.9%, DB -2.9%, UHS -2.8%, XOM -2.7%, WY -2.6%, LEA -2.5%, ILMN -2.3%, AFL -2.1%, TYPE -2.1%, CIGI -2.1%, AZN -2%, MHK -1.9%, NOV -1.9%, ENVA -1.7%, ADM -1.7%, TOT -1.3%, GCAP -1.1%, EMN -0.8%, LYB -0.7%, RGEN -0.6%
Select Semiconductor related names showing weakness:
- MU -3.7%, NVDA -3.1%, ON -2.9%, UCTT -2.1%, SMH -2%, SOXX -2%, STM -1.9%, MRVL -1.6%, LRCX -1.5%, AVGO -1.3%, QCOM -1.2%, ADI -0.9%
Other news:
- INTU -4.9% (reports 7% increase in TurboTax Online units season-to-date; updates Consumer Group revenue guidance)
- TTNP -3.8% (discloses entry into Sales Agreement pursuant to which it may offer and sell, from time to time shares of common stock having an aggregate offering price of up to $25 mln)
- ONCE -2.4% (Spark Therapeutics & Roche (RHHBY) announce withdrawal and refiling of Premerger Notification and Report Form)
- TGT -1.7% (pulling back following AMZN results and free one day shipping plans)
- WMT -1.5% (pulling back following AMZN results and free one day shipping plans)
Analyst comments:
- WDC -4.2% (downgraded to Underperform from Neutral at Robert W. Baird)
- FDX -1.9% (downgraded to Sell from Neutral at UBS)
- PATK -1.4% (downgraded to Underperform from Buy at BofA/Merrill)
- LAD -0.7% (downgraded to Neutral from Buy at BofA/Merrill)
- CDW -0.6% (downgraded to Neutral from Buy at Northcoast)
Gapping up
In reaction to strong earnings/guidance:
- EHTH +13.4%, MAT +10.8%, KNL +9.6%, PRO +8.2%, SFLY +7.9%, F +7.4%, GRUB +5.9%, AON +5%, BLMN +4.4%, CVA +4.3%, TREE +4.2%, POR +3.9%, WPP +3.6%, COLM +3.4%, LOGM +3.2%, BJRI +2.8%, BOOM +2.5%, SNY +2.5%, GVA +2.5%, COF +2.2%, IMAX +2.2%, CY +2%, SWN +2%, RSG +1.9%, SNE +1.4%, AN +1.3%, BABY +1.2%, CL +1.1%, FET +1%, AMZN +0.9%, PFG +0.9%, HRC +0.9%, DRQ +0.8%, OMCL +0.7%, TMUS +0.7%, .
M&A news:
- PETX +37% (to be acquired by Elanco Animal Health (ELAN) for an implied value of $4.75/share in stock + a CVR)
Other news:
- RBBN +4% (discloses binding mediator's proposal that resolves the six previously disclosed lawsuits between the Company and Metaswitch )
- ZAYO +2.9% (drifting higher in extended trading on light volume amid renewed M&A chatter), GM +2.5% (following F earnings/guidance)
- MMYT +1.8% (announces change in shareholding as a result of share exchange transaction agreement between Naspers (NPSNY) and Ctrip.com (CTRP))
- SBBP +1.3% (light volume; presents new secondary endpoint results from the Phase 3 SONICS study of RECORLEV for the potential treatment of endogenous Cushing's syndrome)
- CNC +1.1% (following CEO appearance on MadMoney)
Analyst comments:
- MDCO +8.5% (upgraded to Buy from Neutral at Goldman)
- TEUM +6.4% (initiated with Outperform rating and $7 tgt at Oppenheimer)
- TOCA +4.3% (initiated with a Overweight at Cantor Fitzgerald; tgt $28 - sees high likelihood of Phase 3 Glioma success in 2019)
- CLF +2.5% (upgraded to Outperform from Neutral at Credit Suisse)
- ESPR +1.6% (upgraded to Neutral from Sell at Goldman)
- MAS +1.3% (upgraded to Strong Buy from Mkt Perform at Raymond James)
- DRI +1% (initiated with a Buy at UBS)
- HEXO +0.8% (initiated with Buy at Desjardins)
- CNSL +0.5% (upgraded to Outperform from Market Perform at Wells Fargo)
Early premarket gappersGapping up:
- EHTH +13.4%, OMCL +11.9%, GRUB +10.3%, KNL +9.6%, F +8.2%, PRO +8.2%, MAT +8.2%, BLMN +7%, AON +5%, COF +4.5%, TOCA +4.3%, CVA +4.3%, RBBN +4%, LOGM +3.2%, SFLY +3.1%, WPP +3.1%, ZAYO +2.9%, BJRI +2.8%, GM +2.5%, BOOM +2.5%, COLM +2.4%, LEA +2.3%, CY +2%, RSG +1.9%, APHA +1.8%, TEUM +1.8%, CNSL +1.7%, MRVL +1.7%, SBBP +1.3%, BABY +1.2%, HAS +1%, FET +1%, FTI +1%, CL +1%, AMZN +0.9%, PFG +0.9%, TMUS +0.9%, HRC +0.9%, DRQ +0.8%
Gapping down:
- ATEN -15.1%, INTC -7.6%, FII -7.2%, BGG -7.1%, PFPT -6.3%, BEAT -5.5%, RBS -4.4%, SGEN -4.3%, ILMN -4.1%, WDC -4%, SIVB -3.8%, NR -3.8%, VCRA -3.6%, MOBL -3.5%, INTU -3.4%, INT -3.4%, MU -3.1%, NVDA -2.8%, UHS -2.8%, ON -2.7%, SMH -2.3%, ADNT -2.1%, UCTT -2.1%, MHK -1.9%, SOXX -1.8%, STM -1.7%, ENVA -1.7%, NOV -1.7%, WMT -1.4%, AZN -1.4%, LRCX -1.3%, QCOM -1.1%, GCAP -1.1%, TOT -1.1%, GVA -1.1%, AVGO -1%, ADI -0.9%, EMN -0.8%, JNPR -0.8%, MRK -0.7%, AMD -0.7%, TGT -0.6%, XRT -0.6%, SBUX -0.6%
Renault hires investment bank to put merger plan to Nissan
French carmaker meets strong resistance from Nissan chief and Japan government
Renault has hired one of Japan’s biggest investment banks to put a formal merger proposal to Nissan but has encountered strong resistance from both its chief executive Hiroto Saikawa and the Japanese government, said people involved in the talks.
Renault’s double snub comes as relations between the French carmaker and its alliance partner, Nissan sink to new lows, say people close to both companies. The new merger proposal, said one person familiar with the situation, had ignited resentments that date back to the era when the now ousted Nissan chairman, Carlos Ghosn, led the alliance.
Mr Ghosn had been guiding the alliance towards a merger but those talks were abruptly suspended last November when he was arrested on charges of financial misconduct.
Renault’s merger plan involves a 50-50 holding company structure that envisions an equal split between the board members appointed by Renault and Nissan.
While the French carmaker owns 43 per cent in Nissan, which has a 15 per cent stake in Renault, the merged entity would value the floating values of the two companies at the same price, according to three people with knowledge of the plan.
“This isn’t a hostile offer but an equal merger,” said one person working with the French carmaker. “Renault is making one concession after the other on this plan but the goodwill won’t last forever.”
Tensions within the alliance increased after Mr Saikawa told Renault chairman Jean-Dominique Senard and its chief executive Thierry Bolloré that Nissan was not yet interested in discussing a full merger when the topic was raised during a dinner in Paris in mid-April.
But people close to the situation said that the outcome of that dinner did not seem to have deterred Mr Bolloré, who has within recent weeks told members of Renault’s executive committee that he was directly involved in pushing merger talks further forward.
Several days after the dinner, one of Japan’s most senior investment bankers, acting on Renault’s behalf, asked to meet Mr Saikawa but was refused. According to people close to the situation, the banker was then called in by a top Japanese trade ministry official and told directly that the proposed merger could not work.
The plan, orchestrated by Mr Senard, also envisions the French government will sell its stake in the merged entity when the value of the shares rise, said people close to the situation.
While a merger of equals sounds attractive, people close to Nissan and the Japanese government said Renault has not made clear who would become the chief executive of the new group, which side would bear what proportion of any job cuts and plant closures, and which manufacturing platform and engineering technology would become dominant.
“If this merger goes through, Nissan’s corporate value will fall and people will leave the company,” said one person close to Nissan.
Japan’s Ministry of Economy, Trade and Industry, Nissan and Renault declined to comment.
Uber to kick off investor road show with IPO terms on Friday
(Reuters) - Ride-hailing company Uber Technologies Inc will unveil terms for its initial public offering on Friday, telling investors it will seek to be valued at between $80 billion and $90 billion, according to people familiar with the matter.
The valuation sought is less than the $120 billion valuation that investment bankers told Uber last year it could fetch, and closer to the $76 billion valuation it attained in its last private fundraising round last year.
Uber’s moderation of valuation expectations reflects the poor stock performance of its smaller rival Lyft Inc following its IPO last month. Lyft shares ended trading on Thursday down 22 percent from their IPO price amid investor skepticism over its path to profitability.
Uber will unveil on Friday an IPO price range of between $44 and $50 per share, based on which it would raise between $8 billion and $9 billion, the sources said. This would rank it as the largest IPO since that of Chinese e-commerce giant Alibaba Group Holding Ltd in 2014.
In addition, some Uber insiders will also sell their own shares in the IPO, the sources said. Reuters reported earlier this month that the combined value of Uber shares sold in the IPO could be around $10 billion.
Uber also plans to unveil on Friday its last sale of stock as a private company. PayPal Holdings Inc plans to invest $500 million in a concurrent private placement at Uber’s IPO price, a person familiar with the matter told Reuters. The deal includes a partnership to expand PayPal as a payment option for Uber rides to most of the 70-plus countries where Uber operates.
The PayPal investment was first reported by the Wall Street Journal.
In addition, Uber and PayPal will collaborate on digital payment solutions, including the expansion of Uber’s digital wallet such that customers could, for instance, use it for purchases other of an Uber ride, the person said.
The development of a more robust digital payments service could accelerate Uber’s ambitions to become a “superapp” for a variety of logistics and transportation services, and give the company more opportunities in underbanked regions such as Latin America.
Southeast Asia’s ride-hailing company Grab, for example, has built out a line of financial services, including loans and insurance, to accelerate its growth in the region.
PayPal’s investment and collaboration are contingent upon Uber completing its IPO.
The investor roadshow will kick off in earnest on Monday, setting the stage for Uber to debut on the New York Stock Exchange in early May.
For the roadshow, Uber’s top executives will travel the Unites States and make a stop in London to drum up investor interest in the IPO, sources said.
The sources asked not to be identified because the matter is confidential. Uber declined to comment. The price range was reported earlier by Bloomberg News.
Two other IPOs this month, those of online scrapbook company Pinterest Inc and video conferencing company Zoom Video Communications Inc, have performed much better than Lyft. Uber, however, has chosen to still value itself conservatively.
“People are more cautious than they were 4 weeks ago,” said Duncan Davidson, general partner at Bullpen Capital, an early-stage venture capital investment firm.
In addition to ride hailing, Uber’s business includes bike and scooter rentals, freight hauling, food delivery and an expensive self-driving car division.
The ride-hailing company has disclosed it has 91 million users, but growth is slowing and it may never make a profit. Uber in 2018 had $11.3 billion in revenue, up around 42 percent over 2017, but below the 106 percent growth the prior year.
During the IPO roadshow, Uber’s chief executive, Dara Khosrowshahi, will be tasked with convincing investors that he has successfully changed the company’s culture and business practices after a series of embarrassing scandals over the last two years.
Those have included sexual harassment allegations, a massive data breach that was concealed from regulators, use of illicit software to evade authorities and allegations of bribery overseas.
Uber is reserving some shares in the IPO for some of its most active and best-performing drivers, including those who have completed at least 2,500 trips.
SCALING THE BUSINESS
Last week, Uber’s autonomous vehicle unit raised $1 billion privately from a consortium of investors, including top Uber shareholder SoftBank Group Corp, allowing it to transfer some of the substantial cost of developing self-driving cars onto outside investors and appease some Wall Street concerns over spending.
One advantage Uber will likely seek to play up to investors is that it is the largest player in many of the markets in which it operates. Analysts consider building scale crucial for Uber’s business model to become profitable.
Lyft, which was valued at $24.3 billion in its IPO, has focused only in the U.S. and Canadian markets.
“Investors are now asking for more clarity on how ride-sharing companies will monetize data they are collecting and if this is a scalable business,” said Jordan Stuart, a client portfolio manager for Federated Kaufmann funds who often purchases stock in IPOs.
(Reuters) - Online payments company PayPal Holdings Inc plans to invest $500 million in Uber Technologies Inc as the ride-hailing firm readies to unveil terms for its initial public offering on Friday, Refinitiv IFR reported.
PayPal will invest in Uber through a concurrent private placement at the IPO price, IFR reported on Thursday, citing sources.
A financial services component is important to Uber as it works to expand into a “superapp” of logistics and transportation services.
Superapps are applications where customers go for a range of services, such as transportation, shopping and payments. Such companies can be much more lucrative than those that offer just one core business or service.
Uber is expected to tell investors it will seek to be valued at between $80 billion and $90 billion, according to people familiar with the matter.
The valuation sought is less than the $120 billion valuation that investment bankers told Uber last year it could fetch, and closer to the $76 billion valuation it attained in its last private fundraising round last year.
Uber and PayPal were not immediately available to comment on the IFR report.