Pfizer & BioNTech’s Coronavirus Vaccine Candidates Just Got FDA Fast Track Designation

Plus, Tesla shares are up amid speculation that the electric vehicle maker will soon join the S&P 500, chip maker Analog Devices is buying Maxim Integrated, RTW Retailwinds has declared bankruptcy, and PepsiCo reported earnings.

Stocks were higher to start Monday with the Dow adding 250 points, or nearly 1%. The S&P 500 rose 0.8%, while the Nasdaq traded 1.1% higher.

Pfizer shares are up nearly 5% and BioNTech shares are up more than 15% this morning after the FED granted ‘fast track’ designation for two of the companies’ jointly developed vaccine candidates for the coronavirus. “The FDA’s decision to grant these two COVID-19 vaccine candidates Fast Track designation signifies an important milestone in the efforts to develop a safe and effective vaccine against SARS-CoV-2,” said Pfizer senior vice president for global regulatory affairs, Peter Honig, in a statement. The news comes two weeks after Pfizer and BioNTech announced promising data on their vaccine candidate BNT162b1, a messenger RNA-based vaccine that encodes for proteins that mimic different pieces of the virus that causes COVID-19. In other coronavirus news, Florida over the weekend reported 15,299 new confirmed cases, the highest single day total of any U.S. state since the start of the pandemic. The surge in infections brings the state’s total to 269,811 confirmed coronavirus cases. As confirmed cases in the whole of the U.S. have risen to more than 3.3 million, the World Health Organization said this morning that the nation and Brazil accounted for half of all new daily coronavirus cases worldwide as the two countries struggle to contain their outbreaks. “Let me be blunt, too many countries are headed in the wrong direction,” said WHO Director-General Tedros Adhanom Ghebreyesus during a press conference today. “In several countries across the world, we are now seeing dangerous increases in COVID-19 cases, and hospital wards filling up again. It would appear that many countries are losing gains made as proven measures to reduce risk are not implemented or followed.”

Tesla shares have gained just under 14% this morning amid speculation that the electric vehicle pioneer will soon join the S&P 500. After today’s open, Tesla’s market value has risen to $321 billion, making it the 10th largest U.S. stock by market value. Tesla announced late Friday that it will hold its much-anticipated battery technology event on September 22, and Wedbush analyst Dan Ives wrote in a research note over the weekend that the event should be a positive for the stock. “Musk & Co. are slated to announce a number of new potential game changing battery developments,” Ives wrote. The analyst is expecting a million-mile battery announcement, among other enhancements, at the event, representing “a major step forward when competing versus traditional gasoline powered automotive competitors.” In other news in the electric vehicle space, startup Fisker is going public through a reverse merger with Apollo Global Management-backed Spartan Energy Acquisition Corp, sending shares of the blank-check company up more than 15% this morning. The transaction will bring more than $1 billion in fresh capital to Fisker, fully funding the development of its Ocean electric SUV, which the company said is the world’s most sustainable all-electric SUV as it is manufactured using recycled materials.

Analog Devices is buying Maxim Integrated in an all-stock deal worth $21 billion. The deal is the largest U.S. deal this year, and the combined company will have an enterprise value of around $68 billion. Analog Devices provides sensors, data converters, amplifiers, and other signal processing products to a range of industries from transportation and healthcare to instrumentation and portable consumer devices, while Maxim designs and manufactures analog chips that are used in cars, manufacturing, energy, communications, healthcare, and connected devices. The deal values Maxim at $78.43 per share, a premium of about 10% from the share price as of this writing, and is expected to add to adjusted earnings of the combined entity in around 18 months following the deal’s close, with $275 million in cost savings by the end of year two.

Another retailer has filed for bankruptcy. RTW Retailwinds—the parent company of New York & Co., a women’s apparel retailer—announced this morning that it has filed for Chapter 11 bankruptcy protection and plans to permanently close most, if not all of its stores. The retailer has already kicked off liquidation sales, with around 92% of its bricks-and-mortar locations back open amid the pandemic. RTW Retailwinds said it is evaluating potentially selling its e-commerce operations and related intellectual property in bankruptcy proceedings. “The combined effects of a challenging retail environment coupled with the impact of the coronavirus pandemic have caused significant financial distress on our business, and we expect it to continue to do so in the future,” said RTW Retailwinds CEO and CFO Sheamus Toal in a statement. “As a result, we believe that a restructuring of our liabilities and a potential sale of the business or portions of the business is the best path forward to unlock value.” The New York & Co. parent joins a growing list of retailers who have recently declared bankruptcy, including Brooks Brothers, J.Crew, JCPenney, and Neiman Marcus

And earnings season kicked off this morning with PepsiCo reporting better-than-expected results, pushing the stock up 2.3%. PepsiCo reported adjusted earnings per share of $1.32 on revenue of $15.95 billion, compared to earnings per share of $1.25 on revenue of $15.38 billion expected. CEO Ramon Laguarta said the company spent $400 million on costs related to the pandemic, including personal protective equipment for its employees. PepsiCo’s North American beverage unit saw its organic revenue fall 7%, despite growth at supermarkets and dollar stores as the closure of restaurants, movie theaters, and sports arenas weighed on the business. Outside of North America, the company reported declining sales in its Europe and Africa, Middle East, and South Asia segment, while Latin America’s revenue was flat. The company saw organic sales growth of 15% in its Asia Pacific, Australia and New Zealand, and China segment. Up next, big banks Citigroup, JPMorgan Chase, and Wells Fargo report second quarter earnings tomorrow.

Stocks We’re Watching

Trulieve Cannabis Corp (OTC: TCNNF): Trulieve shares are up more than 28% since Thursday’s close following the medical cannabis company’s announcement that it has partnered with Heavendropt as part of their TruVet Program. “As part of our diversity, equity, and inclusion initiatives, we’re focusing on highlighting, advocating for, and fostering connections to resources that support communities like veterans and persons with disabilities across the state,” said Trulieve CEO Kim Rivers. “Working with an organization like Heavendropt was a natural fit for our TruVet Program and we’re honored to be able to highlight the incredible work they’re doing not just in Florida, but across the United States.”

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