Plus, the $1.9 trillion stimulus plan has been signed into law, L Brands shares are up after the Victoria’s Secret owner lifted forecasts and reinstated its dividend, and AT&T said it now expects to see HBO Max and HBO subscribers of up to 150 million by 2025.
Stocks were lower at the open on Friday with the Dow dropping 23 points, or less than 0.1%. The S&P 500 slid 0.4%, while the Nasdaq fell 1.3%.
Lordstown Motors shares are down more than 16% this morning after the same activist investor that took aim at Nikola last fall said it had taken a short position in the electric pickup maker. “Lordstown is an electric vehicle SPAC with no revenue and no sellable product, which we believe has misled investors on both its demand and production capabilities,” Hindenburg Research said in a report released Friday. “Our research has revealed that Lordstown’s order book consists of fake or entirely non-binding orders, from customers that generally do not even fleets of vehicles. According to former employees and business partners, CEO Steve Burns sought to book orders, regardless of quality, purely as a too to raise capital and confer legitimacy. … On the supply side, we have found that [Burns] has led the company through dubious ethical territory, hyping unvetted technology and unrealistic production timelines.”
Stimulus checks could soon start hitting some Americans’ bank accounts after President Joe Biden signed the $1.9 trillion coronavirus relief bill yesterday. “People can expect to start seeing direct despots hit their bank accounts as early as this weekend,” said White House press secretary Jen Psaki at a press briefing. “This is, of course, just the first wave, [and] payments to eligible Americans will continue throughout the course of the next several weeks.” Biden also announced yesterday that he will direct states to make all adults 18 and over eligible for COVID-19 vaccines by May 1. “If we all do our part, this country will be vaccinated soon, our economy will be on the mend, our kids will be back in school, and we’ll have proven once again that this country can do anything,” Biden said in a primetime address to the nation. With a light at the end of the COVID tunnel, Biden is now turning his focus to an infrastructure overhaul plan that is already getting some push back from Republicans given its focus on transitioning to clean energy.
AstraZeneca is back in the headlines today, and shares are down 1%. The company’s COVID-19 vaccine developed with University of Oxford has now been suspended in a number of countries across Europe and Asia following reports of blood clots in some people who received the shots. The concerns about AstraZeneca’s shot come on top of persistent problems with supply to the EU, with the company expected to deliver less than half the planned number of vaccines to the block in the second quarter. “AstraZeneca vaccines delivery: I see efforts, but not ‘best efforts.’ That’s not good enough yet for AstraZeneca to meet its Q1 obligations,” Thierry Breton, the commissioner for the internal market, tweeted. “It’s time for AstraZeneca’s Board to exercise its fiduciary responsibility and now do what it takes to fulfill AZ’s commitments.”
L Brands shares are up more than 8% this morning after the Victoria’s Secret-owner hiked its profit outlook for the current quarter, and said it would be reinstating its annual dividend, paying down debt, and buying back shares. Building on the momentum the company’s brands saw over the holiday, L Brands now forecasts Q1 earnings of between $0.55 and $0.65 per share, up from a previous range of between $0.35 and $0.45 per share. “We are pleased with our quarter-to-date performance at both Bath & Body Works and Victoria’s Secret,” said CEO Andrew Meslow in a statement. “While the current environment still presents uncertainty, we have raised our earnings guidance for the first quarter due to strong sales and margin results quarter-to-date, which also contributed to an improvement in our expectations for the remainder of the quarter.”
AT&T boosted its subscriber forecast for its HBO Max and HBO today, pushing shares up around 3%. The company, which owns WarnerMedia, said it now expects global subscribers of between 120 million and 150 million for HBO Max and HBO by the end of 2025. At the end of the fourth quarter, HBO Max and HBO had over 41 million subscribes combined, up 20% from 34.6 million a year earlier. “We’re being deliberate and strategic with how we allocate capital to invest in our market focus areas of 5G, fiber and HBO Max, while being committed to sustaining the dividend at current levels and utilizing cash after dividends to reduce debt,” CEO John Stankey said in a press release. “As demand for connectivity and content continues to grow, we are well positioned to deliver.”
Stocks We’re Watching
Innodata Inc (NASDAQ: INOD): Innodata shares are up around 10% today following the company’s Q4 and fiscal 2020 earnings release. “Despite the unprecedented disruptions in 2020, we were still able to grow our revenues and earnings, but more importantly, we are much better positioned entering this new year to show accelerating growth moving forward,” Innodata CEO Jack Abuhoff said in an earnings release. “Our confidence is underpinned by the fact that we are seeing a blue-sky growth trajectory in the industry segments we serve, and our offerings are seeing strong customer adoption. To take advantage of this opportunity we plan to significantly increase our sales and marketing team. Through most of 2020, we had 15 people in sales. Our 2021 budget, by contrast, calls for ending 2021 with a sales team of 98 in total. We are also investing in our proprietary technology solutions to maintain and enhance our product excellence and leadership as well as enable us to scale our business for growth.”