Bitcoin Gains Most In Three Months After Falling Below $32k Over The Weekend

Plus, Virgin Galactic shares are up after a successful spaceflight this weekend, FirstGroup is facing a shareholder rebellion over its plans to sell its iconic yellow school bus business, and Beyond Meat got an analyst upgrade.

Stocks were higher at the open on Monday with the Dow adding 46 points, or 0.1%. The S&P 500 rose by 0.3%, while the Nasdaq gained 0.6%.

Bitcoin has stabilized above $37,000 this morning after falling to $31,179.69 over the weekend. The world’s largest digital currency is up more than 11% to $37,544.37 at the time of writing, marking its biggest gain in more than three months following a wild week last week that wiped billions off its value. “Love or hate it, Bitcoin is impacting markets,” said Amy Wu Silverman, equity derivatives strategist at RBC Capital Markets. “What is Bitcoin – a currency? A 1-for-1 manifestation of Elon Musk’s thoughts? A ‘factor’ of momo+meme+speculation+angry Gen Zs? Like a tween Justin Bieber, you don’t know what Bitcoin will be yet – but you have a feeling it will be big.” Elsewhere in the crypto market, Ether is up nearly 26% to $2,442.44, Dogecoin is up 12% to $0.33, and XRP is up 20% to $0.86. 

Helping to send the crypto market higher this morning, Federal Reserve Governor Lael Brainard pressed the case for a digital dollar, saying in a speech to a conference presented by Coindesk that a cryptocurrency backed by the central bank could provide a variety of benefits. “The Federal Reserve remains committed to ensure that the public has access to safe, reliable, and secure means of payment, including cash,” Brainard said. “As part of this commitment, we must explore—and try to anticipate—the extent to which households’ and businesses’ needs and preferences may migrate further to digital payments over time. … New forms of private money may introduce counterparts risk into the payments system in new ways that could lead to consumer-protection threats or, at large scale, broader financial-stability risks.”

Virgin Galactic shares are up more than 14% this morning after the company’s successful spaceflight test this weekend. Virgin Galactic’s VSS Unity launched from New Mexico on Saturday, flying into space for the first time in more than two years, marking a critical step in its path toward commercial service following a series of setbacks. The “flight showcased the inherent elegance and safety of our spaceflight system, while making a major step forward for both Virgin Galactic and human spaceflight in new Mexico,” said CEO Michael Colglazier in a press release. “We will immediately begin processing the data gained from this successful test flight, and we look forward to sharing news on our next planned milestone.”

FirstGroup is facing a shareholder rebellion over its plan to sell its two U.S. buss businesses—one of which operates the iconic yellow school buses—to Swedish private equity firm EQT. The British FirstGroup announced a month ago that it had agreed to sell its First Student and First Transit for $4.6 billion to EQT, but two of the firm’s biggest investors—Schroders and Coast Capital Management—now oppose the deal and argued in a statement that the sale should be voted down unless terms are substantively improved. “Coast Capital and its fellow shareholders in FirstGroup have long believed that the company’s U.S. & U.K. businesses do not belong together,” Coast Capital said in a statement. “However, we also understand that a sale of these best-in-class public transport operations through a rushed and unexhaustive process in the middle of the largest pandemic in 100 years, at a significantly lower valuation than any comparable transaction, and for less than what FirstGroup acquired First Student & First Transit for 14 years ago, is unacceptable. A vote in favor of this destructive transaction is a clear breach of shareholders’ fiduciary responsibility.”

And Beyond Meat shares are up 10% this morning after Bernstein analyst Alexia Howard upgraded the stock from Underperform to Outperform, and boosted her price target from $101 to $130. Howard acknowledged that the last year has been a difficult one for Beyond Meat as the pandemic led to a plunge in restaurant sales and competitors made strides in the meat-alternative space, but said that consumer demand for such alternatives remains strong and the company is telling investors to expect a recovery in organic growth in the second quarter. “Overall, we believe that Beyond Meat should be recognized as a reopening play that stands to regain meaningful momentum over the coming quarters,” Howard said in the note. 

Stocks We’re Watching

Micronet Enertec Technologies (NASDAQ: MICT): Micronet Enertec announced first quarter earnings results this morning. “After launching our insurance platform in late December, MICT experienced a strong ramp generating revenues of almost $9 million in our first full quarter of operation. This business continues to have strong momentum and we expect a long runway of robust growth. The prospects for our insurance business are particularly exciting as we continue to leverage strong relationships to generate leads,” said CEO Darren Mercer in the earnings release. “The first quarter also saw us complete the development of our stock trading platform, which is now at an advanced stage of testing and expected to have a soft launch in late June with the full rollout in July. As of March 31, 2021, we also had $123 million in cash on our balance sheet, which will provide sufficient capital to execute on our growth plans and offer our customers leveraging facilities. The opportunities for market trading in China and Southeast Asia remain enormous and we are well positioned to capitalize on them.”