US stock indexes are rising today snapping a four-day losing streak, even as as Fed Chairman Jerome Powell said the economy is facing a long recovery path and will require more stimulus. Technology stocks are leading the gains from Amazon, Zoom Video to Twitter, which are up between 5% to 6%.
Amazon is jumping almost 5% after Bernstein upgraded the stock to Buy from Hold, saying that the e-commerce giant is “positioned to increase its dominant [market] share position when the return to physical stores occurs”.
The tech-heavy Nasdaq Composite Index is advancing 1.4%, while the Dow Jones Industrial Average is adding 0.4%. The S&P 500 Index is up 0.9%.
All eyes are on Tesla’s Battery Day kicking off later today. Ahead of the much-hyped event, shares are declining 4.3% after CEO Elon Musk toned down investor expectations.
“Important note about Tesla Battery Day. This affects long-term production, especially Semi, Cybertruck & Roadster, but what we announce will not reach serious high-volume production until 2022” Musk tweeted late on Monday. “We intend to increase, not reduce battery cell purchases from Panasonic, LG & CATL (possibly other partners too). However, even with our cell suppliers going at maximum speed, we still foresee significant shortages in 2022 & beyond unless we also take action ourselves” the controversial CEO added.
Trian Fund Management is taking a bet on Comcast. The stock is up 3.2% after the activist investor bought up 7.1 million in Comcast shares, saying that the cable operator’s stock is undervalued. The investment comes as Pivotal Research analyst Jeffrey Wlodarczak last week raised the stock’s price target to a Street high of $60 (30% upside potential) from $52 and reiterated a Buy rating. Going forward, the analyst sees “healthy” cable EBITDA growth driven by strong high margin data subscriber gains.
Space cloud business: Microsoft has introduced Azure Orbital, which is a new ground station service that enables satellite operators to communicate with and control their satellites, process data, and operations by connecting to its cloud. Shares are up 1.8%.
In yet another partnership, retail giant Walmart has teamed up with Goldman Sachs to offer eligible Walmart Marketplace online sellers access to capital. Walmart Marketplace sellers will be able to use lines of credit by Marcus, Goldman Sachs’ online consumer banking unit. Small and medium businesses on Walmart Marketplace will have access to lines of credit from Marcus between $10,000 – $75,000.
Oppenheimer analyst Rupesh Parikh today raised Walmart’s price target to $152 from $145 and reiterated a Buy rating saying “We believe WMT shares are still positioned for outperformance, but see more of a grind higher from here. Ongoing benefits from WMT’s e-commerce investments, tailwinds from continued increases in at-home food consumption, and retailer liquidations suggest the potential for market share gains to persist.”
“In addition, we look favorably upon the strong underlying cash generation, and the potential for more aggressive return of capital to shareholders in coming years.”
In more retail news, Ralph Lauren is trying to keep its head above water with a reorganization plan. As part of the plan, the luxury apparel maker will reduce its global workforce by the end of its fiscal 2021, which is expected to result in gross annualized pre-tax expense savings of about $180 million to $200 million. The company plans to invest in building new digital capabilities that support areas like omni-channel shopping, social commerce and augmented reality. It will also roll out technology platforms to support its global operations. Shares are up 3.7%.
If you are in the online sales business you are doing well: Carvana, an e-commerce platform for buying and selling used cars, is popping 33% after announcing that it expects to achieve record performance across several important metrics in Q3, including total revenue and total gross profit per unit. The automative retailer said it also forecasts to be EBITDA breakeven this quarter. The update prompted Goldman Sachs and J.P. Morgan to upgrade the stock to Buy.
And last but not least, Genocea Biosciences announced that the US Food and Drug Administration (FDA) has accepted the Investigational New Drug (IND) application for its GEN-011 cancer immunotherapy, sending shares up 7.3%.
The company will now initiate a Phase 1/2a clinical study of GEN-011 in patients who have failed standard-of-care checkpoint inhibitor therapy. The trial will evaluate safety, T cell proliferation and persistence as well as clinical activity.
According to Needham analyst Chad Messer, who has a Buy rating on the stock with a $7 price target (181% upside potential) “GNCA is undervalued versus peer neo-antigen cancer vaccine companies despite Genocea’s early clinical stage.”
