CAPIS Morning Note – 03/04/24: Apple Hit With $1.95 Billion Fine By EU, Powell To Testify

• IPOs Priced or News:
  • MAMO: 1.3 Million IPO Offering.
  • Reddit seeking a valuation of up to $6.5 billion in IPO. (CNBC)
• New SPACs launched/News: None of note.
• Secondaries Priced:
  • BIVI: Prices public offering of stock and warrants.
• Notes Priced of note: None of note.
• Common Stock filings/Notes:
  • ABSI: Announces Closing of Public Offering of Common Stock Including Full Exercise of the Underwriters’ Option to Purchase Additional Shares.
  • BIVI: Announces Proposed Public Offering of Common Stock. (ThinkEquity bookmanager)
  • GDDY: Filed Form S-3ASR.. 270,508 Shares Common Stock.
  • MIST: Filed Form 424B5.. 16,666,667 Common Shares Pre-Funded Warrants to Purchase 3,333,333 Common Shares.
  • NKLA: Filed Form 424B3.. Up to 249,843,711 Shares of Common Stock.
  • RVNC: Announces Proposed Public Offering of Common Stock.
  • VKTX: Form 424B5.. 6.471Million Common Stock.
• Direct Offering:
  • FWBI: To Raise Approximately $4.0 Million of Gross Proceeds in Registered Direct Offering.
• Selling Shareholders of note:
  • NFE: Files mixed securities shelf offering; also files for 114,670,972 share common stock offering by selling shareholders.
  • SYRE: Files for 12,000,000 shares of common stock by selling shareholders.
• Private Placement of Public Entity (PIPE):
  • JAGX: Privately negotiated exchange agreement with Streeterville.
• Mixed Shelf Offerings:
  • ICE: Files mixed securities shelf offering.
  • GLP: Files mixed securities shelf offering.
  • GOVX: FORM S-3 – $100,000,000 Mixed Shelf Offering.
  • PGRE: Files mixed shelf securities offering.
  • PRFX: FORM F-1 – Mixed Shelf Offering.
  • PRU: Files mixed shelf securities offering.
  • SANA: Files mixed shelf securities offering.
  • VYNE: Filed Form S-3.. $250,000,000 Mixed Shelf.
• Debt/Credit Filing and Notes:
  • MP: Proposes offering of $500 million principal amount of its Convertible Senior Notes due 2030. (see Buyback)
  • NFE: Intends to offer $500 million aggregate principal amount of senior secured notes due 2029 in a private offering.
  • SABR: Announces Exchange of $150 Million of Existing 4.000% Exchangeable Senior Notes due 2025 for Exchangeable Senior Notes due 2026.
  • XRX: Announces Offering of Senior Unsecured Notes.
• Tender Offer:
  • RITM: Announces Commencement of Tender Offer for 6.250% Senior Unsecured Notes Due 2025.
• Convertible Offering & Notes Filed:
  • FIVN: Exercise of the Option to Purchase Additional 1.00% Convertible Notes Due 2029.
  • IRTC: Proposes offering of $450.0 million of convertible senior notes due 2029
  • PRGS: issued and sold $450.0 million aggregate principal amount of its 3.50% Convertible Senior Notes due 2030.

Capital Raise Summary From The TradeXchange, bringing traders and investors real time news and Squawk Box, and other sources.

News After The Close and Over the Weekend:

• Weekly Wrap Up: Best and Worst performing large cap stocks:
  • Trading Up: CTMX 73%, GTHX 67%, INSG 51%, CDXS 49%, CDNA 45%, DELL 37%, PSTG 36%, ARLO 35%, EDIT 35%, TGTX 35%, CRBP 33%, TPC 30%, OKTA 30%, RVNC 30%, LXFR 28%, NTRA 27%, EAF 27%, RCM 26%.
  • Trading Down: LPSN -47%, IRWD -41%, COMM -40%, CC -30%, AAN -30%, MDRX -27%, INGN -24%, GRFS -23%, NYCB -22%, FWRD -20%, IART -19%, PRGO -18%, RRGB -17%, MLCO -17%, SIBN -15%.
• News Items After the Close:
  • Coinbase Global (COIN) says it is aware that customers may be experiencing failed sends, withdraws or deposits across Coinbase.com and degraded performance across trading. (Release)
  • AT&T (t): Marissa Mayer, former CEO of Yahoo, joins board of directors.
  • Spirit Aerosystems (SPR) confirms that it is currently engaged in discussions with Boeing about a possible acquisition of the Company by Boeing (BA).
  • Boeing (BA) awarded a $439.6 million modification to previously awarded US Air Force contract.
  • Lockheed Martin (LMT) awarded a $663.1 million modification to a previously awarded US Navy contract.
• News Items Over the Weekend:
  • The Score: Stocks That Defined the Week – DPZ, VKTX, M, ZM, UNH, BA, SPR (WSJ)
  • Apple (AAPL) Is Playing an Expensive Game of AI Catch-Up. (WSJ)
  • Fed’s Powell to Double Down on ‘No Rush to Cut’ Message. (Bloomberg)
  • Step Aside, ESG. BlackRock (BLK) Is Doing ‘Transition Investing’ Now. (WSJ)
  • U.S. production of oil and gas set new seasonal records in December, capping off an unprecedented year, according to data published by the U.S. Energy Information Administration (EIA) on Thursday.  (CQ CNBC)
  • Fitch Downgrades NYCB to Junk – Negative Outlook.
  •  Barron’s:
    • Positive View:  GE, GEV, GEHC, UPS, SNOW of note.
    • Cautious View: VLY, COLB, OZK, SFNC, WAFD, AX, INDB, MBIN, SFBS, DCOM, GOOG, AAPL of note.
    • Mixed View: None of note.
    • Recap:
      • UPS stock failed to deliver in 2023, now time to buy, Barron’s
      • GOOG Google facing real AI threat in search, might be time to worry, Barron’s
      • CAG KLG GIS CPB KHC MDLZ Food stocks looking super cheap, could rally, Barron’s
      • SNOW Snowflake stock tanked after CEO resigned, selloff looks overdone, Barron’s

• Erlanger Type 1 Short Squeezes and Type 4 Long Squeezes reporting earnings this week:

• Exchange/Listing/Company Reorg and Personnel News:
  • Delayed 10-k Filings: ETNB, SSB, FULT, ESTA, MSEX, ARR, PUMP, MDRX, CTKB, SHOO
  • Index Changes:
    • S&P 500 In: Super Micro Computer (SMCI) and Deckers Outdoor (DECK) Out: Whirlpool (WHR) and Zion Bancorp (ZION).
    • S&P 100  In:  Intuit (INTU) will replace Out: Exelon (EXC)
    •  S&P MidCap 400 In: Cytokinetics (CYTK) and Applied Industrial Technologies (AIT) Out: Calix (CALX) and Medical Properties Trust (MPW)
    • S&P SmallCap 600 In: Calix (CALX) Out: Cytokinetics (CYTK) and Applied Industrial Technologies.
    • S&P SmallCap 600 In: Magnolia Oil & Gas (MGY), Air Lease (AL), Box (BOX), BGC Group (BGC), BlackLine (BL), Arch Resources (ARCH) and MGE Energy (MGEE) Out: America’s Car Mart (CRMT), TrueBlue (TBI), Forrester Research (FORR), Oil States International (OIS), Digital Turbine (APPS), Consensus Cloud Solutions (CCSI) and iRobot (IRBT).
  • Barnes & Noble Education (BNED) Receives Continued Listing Standard Notice From NYSE.
  • Cerence (CRNC) names Daniel Tempesta as its new CFO.
  • Five Point Holdings (FPH) announces appointment of Mike Alvarado as COO.
  • Grocery Outlet (GO) names Lindsay Gray as Interim CFO.
  • Lattice Semi (LSCC) CTO Stephen Douglass to retire.
  • NKLA: Thomas B. Okray Named Chief Financial Officer Of Nikola Corporation.
  • NMI Hldgs (NMIH) appoints Aurora Swithenbank as CFO.
  • NYSE American to Commence Delisting Proceedings Against Polished.com Inc. (POL).
  • SMX Appoints Ofira Bar as Chief Financial Officer.
  • Trinity Place Holdings Inc. (TPHS) Discloses Communication from NYSE American.
  • Vitru (VTRU) concludes transition period thereby ending its co-CEO structure; William Matos will be the sole CEO of Vitru.
• Buyback Announcements or News:
  • Blackbaud (BLKB) intends to repurchase 7-10% of its shares through the end of 2024; initiates $200 mln accelerated share repurchase plan.
  • MP Materials (MP) announces that its Board of Directors has authorized a share repurchase program of up to $300 mln of the Company’s outstanding common stock.
  • Oppenheimer Holdings Inc. (OPY) Announces Share Repurchase Program.
  • STMicroelectronics (STM) Announces Status of Common Share Repurchase Program.
• Stock Splits or News:
  • Reverse Split Stocks for today IFBD 1/8 LQR 3/2
• Dividends Announcements or News:
  • Horace Mann (HMN) increases quarterly cash dividend 3% to $0.34 per share from $0.33 per share.
  • Scilex Holding Company (SCLX) Announces that the Official Committee of Unsecured Creditors of Sorrento Therapeutics, Inc., has Filed a Motion with the U.S. Bankruptcy Court to Extend the Lockup Period on Shares of Scilex Stock Previously Distributed by Sorrento to its Stockholders as a Dividend from March 31, 2024 to September 30, 2024.

What’s Happening This Morning: Futures value reflects the change with fair value.

Sector Action – (1/3/6/12/YTD Updated Weekly with Monday release):  

• Daily Positive Sectors: Technology, Energy, Healthcare, Real Estate, Basic Materials, Consumer Cyclical of note.
• Daily Negative Sectors: Utilities of note.
• One Month Winners: Consumer Cyclical, Technology, Industrial, Healthcare, Financial of note.
• Three Month Winners: Technology, Industrial, Healthcare, Financial of note.
• Six Month Winners: Technology, Financial, and Communication Services of note.
• Twelve Month Winners: Technology, Communication Services, and Consumer Cyclical of note.
• Year to Date Winners:  Technology, Healthcare, Communication Services of note.

The stock market Friday continued playing the hits: Nvidia (NVDA) reached new heights, and the S&P 500 notched its 15th record high of the year.  It helped the index log its 16th weekly gain in the past 18 weeks, a hot streak last seen in 1971 when Three Dog Night’s “Joy to the World” topped the Billboard Hot 100.  All three major indexes traded in the green Friday, opening March on a high note after four consecutive monthly gains. The Dow Jones Industrial Average rose 0.2%, or 91 points, while the S&P 500 glided 0.8% higher. Thanks largely to Semiconductor firms, the tech-heavy Nasdaq Composite led the pack with a 1.1% climb, also setting a new record.  (WSJ – edited by QPI)

Upcoming Earnings Of Note: (From Chartroom Software – sorted by market cap, highest to lowest with most visible names)

• Gap Up: AKRO +35%, ETNB +24%, LIFW +17%, M +17%, SE +14%, SMCI +12%, IOVA +7%, LLAP +7%, COIN +6%, CIFR +6%, DECK +5%, CPT +5%, AVDL +4%, CHRS +4%, SCLX +4% of note.
• Gap Down: BIVI -45%, CMCL -14%, RVNC -6% of note.

Insider Action: ALTG sees Insider buying with dumb short selling.  AMH sees Insider buying with smart short sellers.

Rags & Mags: Repeated stories from prior days never listed, i.e. “rehashed news”. Sorted by Global, U.S. and stock specific.

• What You Need To Know To Start Your Day. (Bloomberg)
• 5 Things To Know Before the Stock Market Opens Today. (CNBC)
• Stocks making the biggest moves premarket: SMCI, DECK, M, RACE, BROS, MSTR, RIOT (CNBC)
• Bloomberg Lead Story: China Scraps Premier Li’s Briefing, Breaking Years of Convention. (Bloomberg)
• Stocks pause after rally, seek rate-cut signals: Markets Wrap. (Bloomberg)
• Haley gets first win in D.C. with Super Tuesday ahead. (Bloomberg)
• Congress unveils first of six bills as government shutdown looms. (CNBC)
• Apple (AAPL) hit with more than $1.95 billion EU antitrust fine over music streaming. (CNBC)
• Bloomberg Daybreak: Congressional plans and Powell testimony. (Podcast)
• NYT The Daily: Biden impeachment built on a lie. (Podcast)
• Marketplace: Tech-driven disinformation is not easy to spot. (Podcast)
• Wealthion: Are Central Banks leading us astray with Kathleen Hayes. (Podcast)

Moving Average Update: Back to normal standards….100% across the board.

Geopolitical: 

M&A Activity and News:

• Macy’s (M): Arkhouse and Brigade Capital increase offer to acquire Macy’s to $24.00 per share.
• Terran Orbital (LLAP): Lockheed Martin (LMT) discloses that it submitted a non-binding proposal to acquire LLAP for $1.00 per share.
• United Rentals (URI) to Acquire Yak Access for $1.1 Billion.
• Vista Outdoor (VSTO) rejects unsolicited indication of interest from MNC Capital for $35 a share all cash.

Top Tier Sell-side Upgrades & Downgrades:

The recommendations listed below in this “Upgrade/Downgrade” section are compiled from what we believe are Tier I, II and III firms. Recommendations posted are taken from a variety of sources each day and we only post upgrades or significant initiations as well as downgrades to underweight or sell. The purpose of this posting is to make the reader aware of market-moving recommendations. None of these recommendations should be interpreted as actual recommendations from CAPIS or its employees.

Today’s Upgrades and Downgrades:

Previous Day’s Upgrades and Downgrades: