A roundup of some of the North American equities making moves in both directions today
On the rise
Moderna Inc. (MRNA-Q) will apply for U.S. and European emergency authorization for its COVID-19 vaccine on Monday after full results from a late-stage study showed it was 94.1-per-cent effective with no serious safety concerns, the company said.
Its shares hit a record high and are up more than 600 per cent this year.
Moderna also reported that its vaccine’s efficacy rate was consistent across age, race, ethnicity and gender demographics as well as having a 100-per-cent success rate in preventing severe cases of a disease that has killed nearly 1.5 million people.
The filing sets Moderna’s product up to be the second vaccine likely to receive U.S. emergency use authorization this year following a shot developed by Pfizer and BioNTech which had a 95-per-cent efficacy rate.
“We believe that we have a vaccine that is very highly efficacious. We now have the data to prove it,” Moderna Chief Medical Officer Tal Zaks said. “We expect to be playing a major part in turning around this pandemic.”
Of the 196 people who contracted COVID-19 out of over 30,000 volunteers, 185 had received a placebo and 11 got the vaccine. Moderna reported 30 severe cases, all in the placebo group, which means the vaccine was 100-per-cent effective against severe cases.
“As the numbers of cases reported grows, confidence grows that this amazing protection will be maintained in a product that can be rolled out to protect the public,” said Alexander Edwards, associate professor in biomedical technology at Britain’s University of Reading.
In addition to filing its U.S. application, Moderna said it would seek conditional approval from the European Medicines Agency, which is already reviewing its data, and would continue to talk with other regulators doing similar rolling reviews.
See also: Have markets priced in all the good vaccine news? Not when it comes to these stocks
Shares of Moncton-based Organigram Holdings Inc. (OGI-T) sat flat after it reported fourth-quarter net revenue rose 25 per cent year-to-year to $20.4-million, exceeding the Street’s expectation of $20.3-million.
See also: Cannabis stocks surge as U.S. election opens new markets
Data giant S&P Global Inc. (SPGI-N) rose after it announced a US$44-billion deal to buy IHS Markit Ltd. (INFO-N).
At that price, it would be the biggest deal of 2020 and a sign deal making activity is accelerating as breakthroughs in COVID-19 vaccine-related developments improve the economic outlook.
S&P Global is renowned for providing debt ratings to countries and companies, as well as data on capital and commodity markets worldwide. It became a standalone business in 2011 when its then parent McGraw-Hill separated S&P from its education business.
IHS Markit was formed in 2016 when IHS, whose businesses range from data on automotive and technology industries to publishing Jane’s Defence Weekly, bought Markit Ltd in 2016 for around US$6-billion. Markit, founded by former credit trader Lance Uggla, provides a range of pricing and reference data for financial assets and derivatives.
IHS has a market value of around US$36.88-billion based on the stock’s last close on Friday, Reuters calculations showed, with its share price up around 22 per cent so far this year.
The transaction is likely to face close examination from competition watchdogs, as the market for financial information becomes increasingly concentrated.
Silicon Valley enterprise software company ServiceNow Inc. (NOW-N) was narrowly lower after the Globe and Mail reported it is set to acquire Montreal startup Element AI.
The agreement, announced Monday, marks the end a tumultuous ride for four-year-old Element AI, which was championed at home, drew backing from global investors and once had 500 employees.
A source familiar with the deal said Element AI sold for less than US$500-million, below its valuation when it last raised money in 2019, but added none of its investors would lose money. (The Globe is withholding the source’s identity because they are not authorized to speak on the deal). That includes the Quebec government, which committed US$25-million as part of last year’s US$151.4-million venture financing backed by the Caisse de dépôt et placement du Québec and McKinsey & Co. Quebec’s economy and innovation minister Pierre Fitzgibbon said in an interview the return to government “is basically a wash…We will get out at the price we invested.”
- Sean Silcoff
On the decline
General Motors Co. (GM-N) and Nikola Corp. (NKLA-Q) on Monday announced a reworked agreement on a fuel-cell partnership that eliminates an equity stake in the startup for the Detroit automaker as well as plans for building Nikola’s electric pickup truck.
Nikola’s shares initially rose almost 8 per cent in pre-market trading, but subsequently turned negative. GM shares were marginally down.
In September, the companies announced a deal under which GM would supply batteries, a chassis architecture, fuel cell systems and a factory to build Nikola’s proposed Badger electric pickup in return for an 11-per-cent stake and US$700-million.
But the deal came into question after a short seller criticized Nikola as a fraud, something Nikola has denied.
The new agreement, a non-binding memorandum of understanding, is subject to negotiation and a definitive deal, Nikola and GM said in separate statements.
Under the new deal, GM will supply its fuel-cell system for Nikola’s Class 7 and Class 8 commercial semi-trucks, Nikola said. The companies are also discussing Nikola’s potential use of GM’s Ultium electric battery system in its commercial trailers.
Wedbush analyst Daniel Ives in a research note said the decision by GM not to take a stake in Nikola as originally planned “will be viewed as a clear negative” by some who had hoped that part of the agreement would remain in place.
JetBlue Airways Corp. (JBLU-Q) was lower after it said on Monday it expects cash burn to rise to about US$8-million per day in the fourth quarter, citing recent booking trends and a delay in cash tax refunds.
A renewed surge in COVID-19 infections and travel curbs has further dimmed the financial outlook for the sector, which the International Air Transport Association (IATA) has predicted is set to lose US$87-billion this year.
U.S. airlines received US$25-billion in federal aid to keep employees on payroll between March and September and have now asked for a second round of support.
“Booking trends remain volatile and the company continues to believe demand and revenue recovery will be non-linear through the fourth quarter and beyond,” New York-based budget carrier JetBlue said.
It expects its fourth-quarter average daily cash burn to be between US$6-million and US$8-million, compared with its prior forecast of between US$4-million and US$6-million.
It also forecast a 70-per-cent slump in revenue, compared with its prior expectation of an about 65-per-cent fall.
JetBlue had cash and short-term investments of about US$2.8-billion as of Nov. 27.
U.S.-listed shares of China National Offshore Oil Corp. (CEO-N) tumbled on reports the Trump administration is set to add it to a blacklist of alleged Chinese military companies.
Reuters reported earlier this month that the Department of Defense (DOD) was planning to designate four more Chinese companies as owned or controlled by the Chinese military, bringing the number of Chinese companies affected to 35. A recent executive order issued by President Donald Trump would prevent U.S. investors from buying securities of the listed firms starting late next year.
It was not immediately clear when the new tranche, would be published in the Federal Register. But the list comprises China Construction Technology Co Ltd and China International Engineering Consulting Corp, in addition to Semiconductor Manufacturing International Corp (SMIC) and China National Offshore Oil Corp (CNOOC), according to the document and three sources.
With files from staff and wires
David Leeder