A roundup of some of the North American equities making moves in both directions today
On the rise
Boeing Co. (BA-N) was up after Federal Aviation Administration (FAA) Chief Steve Dickson conducted a nearly two-hour evaluation flight at the controls of a 737 MAX on Wednesday, a milestone for the jet to win approval to resume flying after two fatal crashes.
Mr. Dickson, a former military and commercial pilot, and other FAA and Boeing pilots landed shortly before 11 a.m. local time at King County International Airport - also known as Boeing Field - in the Seattle area.
The flight is a key part of the U.S. planemaker’s long-delayed quest to persuade the FAA to lift a March 2019 grounding order triggered by 737 MAX crashes in Ethiopia and Indonesia that killed 346 people within a five-month period.
The accidents plunged Boeing into its worst-ever crisis, strained its relationship with the FAA, threw into question the U.S. regulator’s position as the standard-bearer for global aviation safety and prompted bipartisan calls in Congress to overhaul how the FAA certifies new airplanes.
Guelph, Ontario-based Canadian Solar Inc. (CSIQ-Q) was up with the premarket announcement that it has secured a US$260-million capital raise for its Module and System Solutions subsidiary, CSI Solar Co Ltd.
It said the transaction is “an important step” for CSI Solar to qualify for the planned carve-out IPO in China.
Apple Inc. (AAPL-Q) was narrowly higher after it granted CEO Tim Cook 333,987 restricted stock units on Tuesday, with a possibility to earn as many as 667,974 more if he hits performance targets, in the executive’s first stock grant since 2011.
“Tim has brought unparalleled innovation and focus to his role as CEO and demonstrated what it means to lead with values and integrity,” Apple’s board of directors said in a statement.
“For the first time in nearly a decade, we are awarding Tim a new stock grant that will vest over time in recognition of his outstanding leadership and with great optimism for Apple’s future as he carries these efforts forward.”
Mr. Cook is in the ninth year of his 10-year grant from 2011. Each restricted stock unit conveys the right to one common share when it vests.
Apple’s stock closed at US$114.09 on Tuesday, which puts the value of the units at US$38.1-million at Tuesday’s price. But they will be more valuable if Apple’s stock price rises by the time they vest. One-third of the units will vest on April 1, 2023 with another third vesting in 2024 and the final third in 2025.
U.S. oil producer ConocoPhillips (COP-N) rose after it forecast third-quarter production of 1.05 to 1.07 million barrels of oil equivalent per day (boepd) said it plans to resume share buybacks after halting them due to a crash in crude prices.
The company said it expects to report an adjusted loss in the range of US$210-million to US$260-million for the quarter, compared with the average analyst estimate of a US$243-million loss, according to Refinitiv IBES data.
Houston-based ConocoPhillips said it intends to resume share repurchases of US$1-billion during the fourth quarter.
The company had suspended its buyback program in April as oil futures tumbled toward an all-time low. It had halved the US$3-billion a year buyback program in the prior month.
The company said on Wednesday it had fully restored production in the lower 48 U.S. states, Alaska and Canada by the end of the third quarter.
Moderna Inc. (MRNA-Q) jumped after researchers said its COVID-19 vaccine candidate produced virus-neutralizing antibodies in older adults at levels similar to those seen in younger adults in an early safety study.
Meanwhile, Switzerland’s Lonza said Tuesday it confident that U.S. and Swiss plants it is building to help make Moderna’s COVID-19 vaccine candidate will be ready for commercial production this year.
New production lines at Lonza’s site in Portsmouth, New Hampshire, aim to start making vaccine ingredients in November, while three lines in Visp, deep in a valley in the Swiss Alps - to supply 300 million vaccine doses annually - should begin delivering by December.
There is no approved COVID-19 vaccine yet, but several are in advanced trials, including from Pfizer Inc, Johnson & Johnson and Moderna, whose candidate relies on technology never previously approved that enlists human cells to help trigger an immune response.
Tommy Hilfiger owner PVH Corp. (PVH-N) rose after it said on Wednesday President Stefan Larsson would replace Manny Chirico as chief executive officer in February.
Mr. Larsson, a former CEO of Ralph Lauren Corp. (RL-N), joined PVH in June last year, taking on the job of overseeing the company’s various brands such as Van Heusen, Calvin Kelin, as well as Tommy Hilfiger.
His appointment was part of PVH’s plan to find a successor to Mr. Chirico, who has been at the helm since 2006.
Mr. Larsson has already been at the forefront of major decisions PVH has taken to tackle the impact of the COVID-19 pandemic, including cutting hundreds of jobs in North America and shuttering 162 retail stores.
Mr. Chirico, 63, will continue to serve as the company’s chairman, PVH said.
U.S. casino operator Caesars Entertainment (CZR-Q) was up after it agreed on Wednesday to buy British-based gambling group William Hill for 2.9 billion pounds (US$3.7-billion) to expand in the fast-growing U.S. sports-betting market.
The U.S. group, owner of Las Vegas’s Caesars Palace, intends to sell William Hill’s non-U.S. operations, including more than 1,400 UK betting shops, and said it would integrate the U.S. business into Caesars with few, if any, job losses.
It could sell the UK assets to private equity group Apollo , sources told Reuters this week, and if that failed, launch an auction process.
Shares in William Hill, which already offers sports betting in Caesars casinos in the United States, hit a two-year high of 312 pence on Friday after the British company said it had received separate takeover offers from Caesars and Apollo.
With the board backing the deal with Caesars, market pricing now indicates investors expect the 272 pence per share takeover by the U.S. company to go through. William Hill shares were last down 0.15% at 273.85 pence.
“This is the best option,” William Hill Chairman Roger Devlin said.
The deal, which Caesars will partly fund via a US$1.7-billion issue of new stock, is a move to take control of - and expand - the companies' U.S. sports-betting joint venture, currently 80-per-cent-owned by William Hill.
In Britain, William Hill has closed more than 700 betting shops after new regulations limited the maximum stake on lucrative gaming machines. Its UK rivals include GVC, which owns the Ladbrokes brand, as well as Flutter Entertainment .
Jefferies analysts said the prospect of a bid battle with Apollo had faded due to the threat of Caesars terminating the joint venture if its deal failed. For the bid to go through, it needs 75-per-cent support from William Hill shareholders.
Marathon Petroleum Corp. (MPC-N), the largest U.S. oil refiner, was lower after it began cutting jobs across the company on Tuesday, as the COVID-19 pandemic sapped demand for motor fuels.
U.S. refiners have posted large losses this year as fuel consumption tumbled amid lockdowns and work-from-home policies to combat the spread of the coronavirus. Thin profit margins have been undercut by the need to operate plants at less than 80% capacity.
Marathon officials are “communicating with our employees about measures we announced earlier this year to strengthen Marathon Petroleum for short-term and long-term success,” a spokeswoman said in a statement. She declined to comment on specific actions.
The Findlay, Ohio-based company has been shedding units to improve results. It had 60,000 employees as of Dec. 31, with two-thirds in retail operations that are being acquired by 7-Eleven Inc, an arm of Japan’s Seven & i Holdings Co Ltd .
Nikola Corp. (NKLA-Q) jumped after Chief Executive Mark Russell said on Wednesday he remains confident the electric and hydrogen fuel cell vehicle startup will close a deal with an energy partner and talks to finalize an alliance with General Motors Co continue.
There had been reports Nikola’s talks with energy firms including BP Plc had stalled, but Russell told Reuters he is confident Nikola will still announce by year-end a collaboration with an energy firm to build hydrogen-refueling stations.
“We’ve talked to all of those folks and those discussions are continuing,” he said in an interview. “We’re confident that we’re still going to hit the milestones laid out there of announcing a partner by the end of the year and getting stations going starting next year.”
Short-seller Hindenburg Research released a scathing report on Sept. 10 that called Nikola a “fraud” and on Wednesday the company released a statement defending its business model, technology and partnerships.
Russell repeated Nikola’s comments from Tuesday that talks with GM continue but declined further comment. Nikola had previously said it expected to finalize terms prior to Sept. 30. GM affirmed on Wednesday that the talks with Nikola continue.
On the decline
Kinross Gold Corp. (K-T) was down after announcing before the bell it has entered into agreements to acquire a 70-per-cent interest in the Peak Gold project in Alaska from Royal Gold Inc. and Contango OR Inc. for total cash consideration of $93.7-million.
Kinross said it will have “broad authority to construct and operate the Peak Gold project, with Contango retaining a 30-per-cent non-operating minority interest.”
The net proceeds will be used for general corporate purposes, “including investing in broadband networks and other capital investment consistent with TELUS' growth strategy, and repayment of commercial paper (incurred for general working capital purposes).”
The company said it intends to use the net proceeds to fund organic growth projects including the Haile underground development, ongoing exploration and development of the company’s mineral properties in New Zealand, as well as for working capital and for general corporate purposes.
Walt Disney Co. (DIS-N) was down in the wake of saying late Tuesday it will lay off roughly 28,000 employees, mostly at its U.S. theme parks, where attendance has been crushed by the coronavirus pandemic, especially in California where Disneyland remains closed.
About two-thirds of the laid-off employees will be part-time workers, the company said in a statement.
Disney shut its theme parks around the world when the novel coronavirus began spreading this year. All but Disneyland - nicknamed the Happiest Place on Earth - gradually reopened, though the company was forced to limit the number of visitors to allow for physical distancing.
“We have made the very difficult decision to begin the process of reducing our workforce at our Parks, Experiences and Products segment at all levels,” Josh D’Amaro, chairman of the parks unit, said in a statement.
He cited the parks' limited capacity and uncertainty about the pandemic’s duration, which he said was “exacerbated in California by the state’s unwillingness to lift restrictions that would allow Disneyland to reopen.”
NextEra is still interested in pursuing the combination even after Duke, with a market value of more than $60 billion, rebuffed its approach, the report said.
The report, however, added there is no guarantee that NextEra would pursue a deal or whether its approach would culminate in one.
NextEra, worth about US$139-billion, did not immediately respond to a Reuters request for comment, while Duke said it does not comment on market rumors or speculation.
Shares of Duke rose on the news.
Earlier in the day, a NextEra unit said it had entered into definitive agreements with affiliates of Blackstone to acquire electric transmission firm GridLiance for about US$660-million, including debt.
Micron Technology Inc. (MU-Q) slipped after the chipmaker said it has not yet obtained new licenses needed to sell its memory chips to China’s Huawei Technologies Co Ltd , which would cut its sales over the next two quarters.
In a research note, Citi analyst Christopher Danely said: “Micron reported strong results but guided well below Consensus as we previewed due to lower memory pricing and one less week in the quarter. We are closing our negative catalyst watch with the stock down 4% in after-hours trading. We reiterate our Sell rating as the DRAM double dip is ongoing, however, we could more become positive on MU stock if we believe a sustainable upturn could occur – a key point being lower inventory at Micron.”
With files from staff and wires