A roundup of some of the North American equities making moves in both directions today
On the rise
Shares of Nikola Corp. (NKLA-Q) soared almost 50 per cent in early afternoon trading on Tuesday after General Motors Co. (GM-N) said it was acquiring an 11-per-cent stake, worth US$2-billion, in the U.S. electric truck maker.
General Motors will receive US$2-billion in newly issued Nikola stock and will get a right to nominate one director to the electric truck maker’s board.
As a manufacturing partner, the No.1 U.S. automaker said it will build the Nikola Badger with either an electric battery or fuel cell electric variants. Production is expected by year-end 2022, and will have lower costs across other models.
GM expects to receive benefits in excess of US$4-billion between equity value of shares, contract manufacturing of the Badger, among other perks as part of the agreement.
The companies expect to save US$4-billion in battery and powertrain costs over 10 years and over US$1-billion in engineering and validation costs.
GM shares were up 10.2 per cent.
Winnipeg-based Artis Real Estate Investment Trust (AX.UN-T) increased 6.1 per cent after it announced that its board has approved “a comprehensive plan to unlock unitholder value,” including the spin-off of its Canadian retail properties into a newly formed retail real estate investment trust.
“We believe our high-quality, diversified commercial portfolio is being significantly undervalued by the market and that the proposed strategies will serve to unlock value for our unitholders”, stated Armin Martens, CEO of Artis REIT.
Along with the retail spin-off, Artis REIT said it plans to increase it non-core asset sale program.
In addition to the $800-million of asset sales completed, Artis REIT said it plans to sell a further $550-million of non-core assets “with the net proceeds used for debt reduction at Artis REIT.”
It said about $200-million of non-core assets are currently under conditional sale agreements, expected to be completed by the end of 2020. Artis REIT said it expects to have sold a total of approximately $1.35-billion of assets between the fourth quarter of 2018 and the second quarter of 2021.
Peloton Interactive Inc. (PTON-Q) increased 12.7 per cent after announcing it is cutting the price of its core exercise bike by almost 25 per cent to US$1,895. It also announced the introduction of the Peloton Bike+ and the Peloton Tread.
See also: Peloton: The latest virus panic buy
Beyond Meat Inc. (BYND-Q) jumped 8.6 per cent after announcing it will begin making plant-based meat in China later this year.
The El Segundo, California-based company said it will be the first multinational company focused solely on plant-based meat production to open a factory in China. Swiss food giant Nestle is also building a plant-based meat production facility in China, but it makes other products there.
Beyond Meat is partnering with the Jiaxing Economic and Technological Development Zone — about 75 miles from Shanghai — to design and develop two manufacturing facilities. Trial production will begin later this year, with full production expected in early 2021.
One of the facilities will be the world’s largest plant-based meat factories, Beyond Meat founder and CEO Ethan Brown said in a statement.
Toronto-based Excellon Resources Inc. (EXN-T) sat 3.1 per cent higher after announcing it has applied to list its issued and outstanding common shares on the NYSE American. It expects trading to commence in late September.
In connection with the planned listing, the company will consolidate all of its common Shares on the basis of one new post consolidation common share for every five existing pre-consolidation common shares.
“Listing on the NYSE American provides enhanced access to the world’s largest and most liquid equity markets, which we believe will deliver exceptional value for our shareholders,” said President and CEO Brendan Cahill. “Both institutional and retail investors based in the United States will have significantly greater ability to invest in Excellon through more familiar platforms.”
Great-West Lifeco Inc. (GWO-T) was up 2.6 per cent in the wake of subsidiary Empower Retirement signing an agreement to buy the retirement services business of Massachusetts Mutual Life Insurance Co. in a transaction valued at about $4.4-billion.
The company says the deal will strengthen Empower’s position as the second largest player in the U.S. retirement market.
The deal follows an announcement in June that Empower would buy U.S. investment manager Personal Capital.
Great-West says the MassMutual retirement services business includes 26,000 plans with approximately 2.5 million participants and US$167-billion in assets.
In addition, Empower and MassMutual plan a partnership through which digital insurance products offered by Haven Life Insurance Agency and MassMutual’s voluntary insurance and lifetime income products will offered to Empower and Personal Capital customers.
The deal is expected to close in the fourth quarter of 2020.
On the decline
The message came in the wake of a bid for Cogeco and subsidiary Cogeco Communications Inc. from New York-based cable company Altice USA Inc. and Toronto-based Rogers Communications Inc. (RCI.B-T).
Shares of Rogers were up 0.2 per cent.
Suncor Energy Corp. (SU-T) slid 6.3 per cent after trimming its 2020 production guidance in response to the August fire at its Base Plant operations.
On Monday, the Calgary-based company said production at the facility was restore 165,000 barrels per day of mined bitumen on Aug. 29 with full mining expected to be achieved by the middle of the fourth quarter. However, with that reduced output, Suncor lowered its 2020 production guidance to 680,000-710,000 barrels of oil per day from 740,000-780,000 bbl/d.
Marijuana producer Aurora Cannabis Inc. (ACB-T) was down 8.3 per cent in the wake of appointing insider Miguel Martin as its chief executive officer and saying it would record up to $1.8-billion in impairment charges in the fourth quarter.
Mr. Martin will replace interim CEO Michael Singer, who will remain executive chairman, the company said in a statement.
Aurora in February announced the exit of founder and Chief Executive Officer Terry Booth, along with 500 job cuts and impairment charges, as it came under fire for its aggressive global expansion amid uncertain demand.
Aurora said it expects fourth-quarter net revenue to be between $70-million and $72-million, including $66-million to $68-million in cannabis net revenue.
Tesla Inc. (TSLA-Q) plummeted 16.3 per cent after the electric car maker was excluded from a group of companies being added to the S&P 500, among them Etsy Inc. (ETSY-Q), whose stock market value is less than a 20th of Tesla’s.
The decision by S&P Dow Jones Indices is a blow to Tesla investors who widely expected the company to join the benchmark stock index after a blockbuster quarterly report in July cleared a major hurdle for its potential inclusion.
S&P Dow Jones Indices said in a statement it was adding online craft seller Etsy, semiconductor equipment maker Teradyne (TER-Q) and pharmaceutical technology company Catalent (CTLT-N) to the S&P 500, effective Sept. 21, and removing H&R Block (HRB-N), Coty (COTY-N) and Kohls (KSS-N).
With a market capitalization over US$370-billion, Tesla is one of the most valuable companies on Wall Street. Even after a 16-per-cent drop in its share price from record highs last week, Tesla remains more valuable than 95 per cent of the S&P 500′s existing components, including Johnson & Johnson (JNJ-N) and Procter & Gamble (PG-N).
Etsy, Teradyne and Catalent have a combined stock market value of about US$40-billion.
Boeing Co. (BA-N) slid 4.3 per cent after the U.S. Federal Aviation Administration said Sunday it is investigating manufacturing flaws involving some 787 Dreamliners but said it was too early to say if it will require new inspections.
On Tuesday, Boeing secured its first 737 MAX order in 2020, but the U.S. planemaker added more cancellations as customers ditched orders for the grounded MAX jets and overall aircraft deliveries fell to 13 in August, monthly data showed on Tuesday.
Boeing said it lost another 17 orders for the 737 MAX jet in August, bringing the total number of cancelled orders, including those where buyers converted the MAX to a different model, to 445 for this year.
The planemaker’s first MAX order this year was from Poland’s Enter Air, for two 737-8 aircraft with an option for two more jets. Boeing also booked 3 MAX orders from an unidentified customer.
With files from Brenda Bouw, staff and wires