A roundup of some of the North American equities making moves in both directions
On the rise
Shares of Lululemon Athletica Inc. (LULU-Q) were higher after it revealed in a regulatory filing its board has approved a US$500-million increase to its ongoing stock repurchase program, raising the total to US$641.2-million.
Kelowna, B.C.-based The Valens Company Inc. (VLNS-T) rose after announcing it has entered into six manufacturing partnerships to produce a variety of cannabis products.
It said the agreements include three of the top seven Canadian licensed producers by market share and “showcase the vast manufacturing capabilities that Valens offers to its customers.”
“The majority of the agreements were signed in the last three weeks, indicative of the significant interest in the capabilities provided by the Valens platform. The collective agreements are expected to commence over the next two quarters, with anticipated revenue generation during the same period. In addition, four of the agreements require deposits that are up to 100 per cent of initial purchase orders,” the company added.
Payments technology firm Nuvei Corp. (NVEI-T) gained after announcing late Monday it has filed for an initial public offering in the United States, more than a year after its debut on the Toronto Stock Exchange.
The company is offering a total of 1.5 million of its subordinate voting shares. Part of those shares will be listed on Nasdaq under the symbol “NVEI,” the company said.
Proceeds from the sale will be used to beef up its finances and pursue other strategies for growth.
In addition to payments technology, Nuvei also offers foreign exchange services, local acquiring, and risk management services in countries including the United States and Canada.
The company is backed by Fidelity Management & Research Co and Manulife Investment Management (North America), among others, according to data from Refinitiv.
Last year, Nuvei raised $700-million in its Canadian IPO, in what was then the largest ever technology company offering on the Toronto Stock Exchange.
A day after its shares dropped 4.9 per cent after suffering a lengthy global outage, Facebook Inc. (FB-Q) rebounded on Tuesday despite being pounded by U.S. lawmakers, accusing CEO Mark Zuckerberg of pushing for higher profits while being cavalier about user safety and they demanded regulators investigate whistleblower accusations that the social media company harms children and stokes divisions.
Coming a day after Facebook and its units including Instagram suffered a major outage, whistleblower Frances Haugen testified in a congressional hearing that “for more than five hours Facebook wasn’t used to deepen divides, destabilize democracies and make young girls and women feel bad about their bodies.”
In an era when bipartisanship is rare on Capitol Hill, lawmakers from both parties excoriated the nearly US$1-trillion company in a hearing that exemplified the rising anger in Congress with Facebook amid numerous demands for legislative reforms.
As lawmakers criticized Facebook and Mr. Zuckerberg, the company’s spokespeople fought back on Twitter, arguing Ms. Haugen did not work directly on some of the issues she was being questioned on.
Senate Commerce subcommittee chair Senator Richard Blumenthal, a Democrat, said Facebook knew that its products were addictive, like cigarettes. “Tech now faces that big tobacco jawdropping moment of truth,” he said.
Johnson & Johnson (JNJ-N) edged higher after submitting data to the U.S. Food and Drug Administration for emergency use authorization of a booster shot of its COVID-19 vaccine in people aged 18 years and older.
J&J said its submission includes data from a late-stage study that found a booster given 56 days after the primary dose provided 94-per-cent protection against symptomatic COVID-19 in the United States and 100-per-cent protection against severe disease, at least 14 days after the booster shot.
While scientists are divided over the need for booster shots when so many people in the United States and other countries remain unvaccinated, the Biden administration announced the push for an extra dose in August to shore up protection against the highly transmissible Delta variant.
J&J’s filing comes after the FDA last week scheduled an Oct. 15 meeting of its expert advisory committee to discuss whether to authorize a second shot of the company’s single-dose vaccine.
PepsiCo Inc. (PEP-Q) gained in the wake of raising its full-year revenue forecast on Tuesday, as the opening of public venues including theaters and restaurants following the lifting of pandemic-induced restrictions boosted demand for its sodas and snacks.
The company said revenue from its North America Beverage unit, its largest business, rose 7 per cent in the third quarter on a double-digit increase in net revenue from food-service joints and strong demand for its Mountain Dew soft drink.
Revenue from the company’s Frito-Lay North America business also rose about 6 per cent in the quarter, signaling that pandemic driven demand for salty and savory snacks was still holding strong despite people starting to spend less time at home.
However, PepsiCo’s net attributable income fell about 3 per cent to US$2.22 billion, due in part to higher distribution costs as it grappled with rising raw material prices and global supply chains disruptions, which have pressured profit margins at packaged food companies this year.
Net revenue rose 11.6 per cent to US$20.19-billion in the quarter ended Sept. 4, above analysts’ estimates of US$19.39-billion, according to IBES data from Refinitiv.
The company said it was expecting fiscal 2021 organic revenue to rise about 8 per cent, compared with its prior forecast of a 6-per-cent increase.
California-based fuel-cell truck maker Hyzon Motors Inc. (HYZN-Q) on Tuesday rejected a report by Blue Orca, saying it was inaccurate and misleading, and was solely intended to generate profits for the short seller.
Hyzon shares, which have slumped 35 per cent since the publication of the report last week, rose as much as 16 per cent.
Blue Orca had said in the report that it had taken a short position in the stock, alleging that Hyzon’s largest customer Shanghai HongYun was a “fake company” that was formed just days before an announcement of a deal to supply up to 500 fuel-cell vehicles.
“In our opinion, such evidence suggests that Hyzon announced a major order with a fake looking Chinese customer just to pump its stock price,” the short seller had said.
In response to Blue Orca’s claims, Hyzon Chief Executive Craig Knight said, “Hyzon has no record of this short seller ever meeting with Hyzon management, requesting any information or clarification ... or seeking to verify any of its claims.”
Mr. Knight also assured investors the company had US$500-million of cash and cash-equivalents on its balance sheet to execute its business.
Southwest Gas Holdings Inc. (SWX-N) was higher amid reports activist investor Carl Icahn holds a significant stake and is pushing the gas distribution company to abandon a potential acquisition and instead focus on improving its share price.
Shares in Southwest Gas, which serves more than 2 million customers in Arizona, California and Nevada, spiked nearly 8 per cent on the news, which was first reported by The Wall Street Journal.
On Sunday, Reuters reported that Southwest Gas is in advanced talks to acquire Questar Pipeline Co, a gas transportation and storage business of Dominion Energy Inc , for close to US$2-billion, including debt.
That deal comes after the energy arm of Warren Buffett’s Berkshire Hathaway Inc. (BRK.A-N, BRK.B-N) abandoned in July an acquisition of Questar for $1.7 billion, including debt, because of fears antitrust regulators would not sanction it. This was part of a wider deal to purchase Dominion’s gas infrastructure business.
On the decline
Tricon Residential Inc. (TCN-T) was lower with the premarket announcement of the launch of a marketed US$395-million public offering and private placement of its common shares in connection with an initial public offering in the United States.
The Toronto-based owner and operator of single-family rental homes and multi-family rental apartments has filed an application to list on the New York Stock Exchange. It will continue to trade on the Toronto Stock Exchange.
Tricon also intends to change the denomination of its dividend to U.S. dollars from Canadian following the listing. It currently pays 7 cents per share each quarter.
Rivalry Corp. (RVLY-X), a Toronto-based sports betting and sports media company, fell in its first day of trading on TSX Venture Exchange.
“Listing publicly on the TSXV marks the next major step in Rivalry’s journey,” said co-founder and CEO Steven Salz in a release. “We are building the most comprehensive betting and entertainment experience for the next generation globally, and feel we are just getting started. Our team is grateful for the support of all our early investors and we look forward to continued mutual success.”
With files from staff and wires