Stock Analysis & Ideas

Wednesday’s Pre-Market: Here’s What You Need To Know Before The Market Opens

Dow and S&P 500 futures were trading relatively flat on Wednesday, with Nasdaq futures falling around 0.25% at the time of writing.

ADI announced an 11% hike in its quarterly dividend yesterday and will release its results before the market opens. Some of the other companies reporting today include HLT and GRMN before the bell, with BIDU, SNPS and PXD expected to release their earnings results after the market closes.

Sundial Growers (SNDL) has consistently been the most actively traded stock before the bell over the past week. Over six million shares had already been traded at the time of writing, after the cannabis company filed for a mixed shelf offering of up to $1 billion.

The biggest gainer in pre-market trading was TDH Holdings (+295%), followed by Dogness (+207%) and Akumin (+184%).

Pre-market’s biggest losers were ClearOne (-44%), Socket Mobile (-21%) and Aikido Pharma (-20%).

In corporate earnings news, EXACT Sciences (EXAS) was trading over 4% lower before the bell after reporting lower-than-expected Q4 earnings. The loss per share of $2.79 was greater than the $0.22 loss expected by analysts, while revenues of $466.3 million increased around 58% year-on-year, topping analysts’ estimates of $446.22 million. The company generated sales of $1.49 billion for FY2020, up from the $876.29 million posted in 2019, while the diluted loss per share for the year came in at $5.61 versus a loss of $0.64 a year earlier.

Sabre (SABR) also reported worse-than-expected Q4 results as pandemic-led travel restrictions negatively impacted air and hotel bookings. A Q4 adjusted loss of $0.77 per share was larger than the $0.66 loss feared by analysts, with year-on-year revenues plunging 67% to $314 million compared to analysts’ forecasts of $328.6 million.

Meanwhile, America’s Car-Mart (CRMT) posted better-than-expected Q3 earnings driven by a 16.5% increase in the average sales price and an approximately 6% increase in the number of units sold. Earnings per share (EPS) of $2.85 came in ahead of the $2.55 expected by analysts, while revenues increased 22% year-on-year to $228.3 million, topping analysts’ estimates of $216.9 million. CEO Jeff Williams said, “We believe we are in early stages of transformation from a collections company to more of a sales company that is very good at collections.”

In M&A news, Hexo Corp. (HEXO) announced yesterday that it has bought Zenabis Global (ZBISF) in an all-stock deal valued at C$235 million. Following the announcement, shares of Hexo and Zenabis ended the day 22% and 18% higher, respectively. The acquisition will give Hexo immediate access to the European medical cannabis market, with annual synergies of C$20 million expected within one year following the closure of the acquisition.

Accenture (ACN) has acquired UK-based Infinity Works for an undisclosed amount in its bid to strengthen its cloud services business in the UK. Earlier in the week, Accenture acquired UK-based Edenhouse to better support clients with their digital transformation needs. The acquisition of Infinity will allow Accenture to leverage the digital transformation consultancy’s deep cloud and engineering specialization capabilities, and help clients innovate and operate with speed and flexibility at scale.

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