A roundup of some of the North American equities making moves in both directions today
On the rise
Ovintiv Inc. (OVV-T) rose almost 1 per cent in early afternoon trading said on Thursday it laid off 25% of its total workforce this month as the oil and gas producer, formerly Encana Corp., grapples with plunging fuel demand and lower prices due to the COVID-19 crisis.
The company said it now has around 2,100 employees and contractors.
Ovintiv completed a change of base from Calgary to Denver in January, which Chief Executive Officer Doug Suttles had reasoned would allow the company access to a deeper capital market.
However, that vision was shattered as the pandemic eroded oil demand, while prices tumbled further after Saudi Arabia and Russia in March threatened to flood the market with more oil.
Many shale producers have lately reduced their workforce, slashed budgets and cut dividends in efforts to save enough cash for survival as investors turn their backs on the industry.
Ovintiv’s shares have more than halved in value so far this year, while U.S. oil prices have fallen about 38 per cent.
Aimia Inc. (AIM-T) increased 2.7 per cent after saying it has closed a transaction with Kognitiv Corp. after the Quebec Superior Court dismissed an application from Air Canada to halt the merger.
The airline had argued that the transaction would breach non-competition and confidentiality provisions included in Aimia’s $516-million sale of loyalty program Aeroplan to Air Canada in November 2018.
Aimia denied the allegations and called Air Canada’s court application “without merit and an abuse of process.”
The transaction announced in April was viewed by Aimia as key to its corporate reinvention from a rewards points company into an investment manager.
AMC Entertainment Holdings Inc. (AMC-N) jumped 1.6 per cent after announcing Friday it would require guests to wear face masks at all of its U.S. movie theaters when they reopen in July, a reversal of a policy from a day earlier that prompted a swift backlash.
On Thursday, AMC had said it would only encourage mask wearing except in states where authorities required it.
The policy drew immediate criticism on social media from people who said they would not feel safe if others around them were not wearing masks.
AMC said on Friday that it had listened to reactions from its customers and scientists and reversed course.
“It is clear from this response that we did not go far enough on the usage of masks,” AMC Chief Executive Adam Aron said in a statement.
“As we reopen theatres, we now will require that all AMC guests nationwide wear masks as they enter and enjoy movies at our theatres.”
AMC, the world’s largest movie theater operator, plans to reopen 450 theaters in the United States on July 15, and the remaining 150 theaters in the country in time for the opening of Walt Disney Co’s “Mulan” on July 24 and Christopher Nolan’s “Tenet” on July 31.
Chesapeake Energy Corp. (CHK-N), the shale pioneer widely anticipated to seek bankruptcy protection, was up 1.6 per cent after it said on Thursday it had skipped an interest payment due June 15 on some of its notes and its capacity to borrow money was slashed by lenders.
The company said in a regulatory filing its borrowing base under a so-called ‘reserve-based’ loan was cut to US$2.3-billion from US$3-billion and its creditors had agreed to waive some events of default.
Reuters had earlier reported that Chesapeake had failed to make the interest payment, around US$13.5-million, that was supposed to be made on some of its notes due 2021 and 2027.
The company has been in talks with creditors, which include Franklin Resources Inc, to “roll up” some of its existing debt and make it part of a bankruptcy loan, Reuters reported.
On the decline
Apple Inc. (AAPL-Q) dropped 0.5 per cent after saying on Friday it is temporarily shutting some stores again in Florida, Arizona, South Carolina, and North Carolina in the United States, as novel coronavirus cases continue to rise in the country.
Apple had planned to reopen about 100 U.S. stores, mostly with curbside pickup but some with walk-in service, in late May as lockdown restrictions began to ease.
However, cases in the United States have been steadily rising, with over 2.2 million people infected and at least 118,396 people dead.
In a letter to Apple customers in May, Deirdre O’Brien, Apple’s retail chief, had said the company would look at data on a local basis and that re-closings were a possibility based on that data.
Slack Technologies Inc. (WORK-N) was down almost 2 per cent after Goldman Sachs analyst Heather Bellini downgraded its stock.
“Although Slack has been a near-term beneﬁciary of the working-from-home environment, a key focus from here will be what we expect to be an enduring battle with Microsoft Teams over market share,” she said. “While we continue to view Slack as a best-in-class team messaging offering that is favored by the technical community, we expect MSFT Teams to continue to try and leverage its packaging within Ofﬁce 365 to drive increased adoption, thus creating the potential for a more competitive environment. As such, there is the potential for this to impact Slack’s long-term growth rate and penetration of its addressable market.”
Ms. Bellini moved her rating for the San Francisco-based workplace messaging app provider to “sell” from “neutral.”
Draftkings Inc. (DKNG-Q) declined 1.6 per cent after announcing late Thursday the upsize and pricing of its previously announced underwritten public offering of 40 million shares of its Class A common stock.
The daily fantasy sports contest and sports betting provider will sell 16 million shares and certain selling stockholders will sell 24 million shares at a public offering price of US$40 per share for a total offering size of US$1.6-billion.
With files from staff and wires