A roundup of some of the North American equities making moves in both directions today
On the rise
Just Energy Group Inc. (JE-T) rose after PIMCO, a California-based global investment management firm, disclosed a 28.9-per-cent activist stake in the Mississauga-based company in a regulatory filing.
PIMCO stated: “In connection with the closing of the Recapitalization, the PIMCO Entities entered into an investor rights agreement with the Issuer, Sagard Credit Partners. Pursuant to the Investor Rights Agreement, the PIMCO Entities and Sagard Entities will be entitled to designate one individual for election or appointment to the Issuer’s board of directors or, whenever the PIMCO Entities and Sagard Entities collectively hold 20% or more of the Common Shares, the PIMCO Entities and Sagard Entities will be entitled to designate two individuals for election or appointment to the Issuer’s board of directors. The Investor Rights Agreement also provides the PIMCO Entities and the Sagard Entities with customary demand and “piggyback” registration rights. The PIMCO Entities may exercise any of their director designation rights and registration rights pursuant to the Investor Rights Agreement in their sole discretion; however, the PIMCO Entities have agreed to consult with the Sagard Entities prior to, in each case, designating a director to the Issuer’s board or exercising any registration rights under the Investor Rights Agreement.”
U.S.-listed shares of major North American cannabis producers were mixed in early trading, a day after Democratic vice president nominee Kamala Harris said marijuana would be decriminalized at a federal level in the United States under a Biden administration.
During Wednesday night’s debate with Vice President Mike Pence, Harris said she and Democratic presidential nominee Joe Biden would also expunge the criminal records of people convicted of marijuana-related offenses in the past.
Even though many U.S. states have legalized marijuana use, banks and other traditional financial institutions have so far largely refused to work with the industry as cannabis is still a classified substance at the federal level.
“Access to safe banking will transform the industry, freeing up capital markets for investment and reducing the risk of operating a cannabis business,” said Keith Cich, co-founder of cannabis-related products manufacturer Sunderstorm Inc.
It says the funds will provide additional liquidity for operations and M&A activities with improved terms and conditions.
MTY Food Group Inc. (MTY-T) soared in the wake of reporting stable earnings in the third quarter despite lower revenues caused by the impact of COVID-19.
The restaurant company behind such brands as Thai Express, Tiki-Ming, Tutti Frutti and Valentine says its net profit was $22.9-million or 93 cents per diluted share, compared with $22.9-million or 91 cents per share a year earlier.
Revenues for the period ended Aug. 31 decreased 16 per cent to $135.4-million from $161.3-million in the same period last year.
System-wide sales fell to $897.5-million from $1.08-billion in the third quarter of 2019.
MTY says 52,900 business days were lost during the quarter with 1,470 restaurants temporarily closed at the beginning of the quarter and 364 at the end.
As of Friday, 339 locations representing less than five per cent of the company’s network remained shuttered, with additional restrictions recently imposed forcing some restaurants to close again.
“For the next quarter, we will continue to monitor the impacts of the pandemic, adjust our operations to these volatile market conditions, help our franchisees access government programs that are available to them and aggressively manage our expense levels and liquidity,” said CEO Eric Lefebvre.
The Montreal-based transport and logistics company may purchase up to 7 million common shares, representing 7.92 per cent of the public float.
Calling its performance “strong,” the Toronto-based company said it’s still on track to meet its previously issued guidance for 2020 and may exceed its gold production forecast
“Our operations continue to perform extremely well and delivered another strong quarter of production in the third quarter,” said CEO David Rae. “Our impressive performance year-to-date reflects outstanding efforts at all of our sites to proactively manage the challenges of the COVID-19 pandemic.”
Brazilian miner Vale SA (VALE-N) gained ground after saying its board has approved a joint venture of unit Vale International with China’s Zhoushan Port Company Ltd to build and operate Project West III in the port of Shulanghu, according a securities filing on Friday.
Vale said the port project expansion will demand multi-annual investments of about US$624-million, adding it will have 50 per cent of of the joint venture. Both partners plan to obtain financing for up to 65 per cent of the project, the filing said.
Shares of AMD fell with the news.
Gilead Sciences Inc. (GILD-Q) rose after final data from the drugmaker’s antiviral drug remdesivir showed the treatment cut COVID-19 recovery time by five days.
In patients who were on oxygen when they first got the drug, remdesivir - sold under the brand Veklury - reduced recovery time by seven days compared with placebo after 29 days, according to the 1,062-patient study, published in the New England Journal of Medicine.
The final study looked at data at 29 days of treatment, versus a preliminary study released in May that reported results after 15 days.
Gilead’s drug was among the first to be used as a treatment for the novel coronavirus, and was one of the drugs recently used to treat U.S. President Donald Trump.
General Electric Co. (GE-N) jumped as a report said Goldman Sachs reinstated coverage on the U.S. industrial conglomerate with a “buy” rating, saying the company will emerge stronger from the COVID-19 pandemic.
“Admittedly, we might be a little early on the turn in the stock, but we believe we are at a bottom from both a fundamental and sentiment perspective, and that is typically the best time to own industrial cyclicals,” said analyst Joseph Ritchie, who called it the “ultimate self-help, vaccine-leverage story in Industrials.”
On the decline
Pfizer Inc. (PFE-N) was lower after saying on Friday its cancer drug Ibrance did not meet the main goal in a late-stage trial in patients with a type of breast cancer, the latest setback in the company’s attempt to expand the use of the drug to treat earlier stages of the disease.
The news comes after an independent data monitoring committee said in May a similar trial comparing Ibrance plus an endocrine therapy to a standalone endocrine therapy was unlikely to meet the main goal.
Ibrance is already approved in the United States to treat certain adult patients with advanced breast cancer which has spread to other parts of the body. The drug has not yet been approved for treating early stages of breast cancer.
With files from staff and wires