Plus, Target also reported an earnings beat, PayPal and Fiserv are partnering to allow gig workers to get their paychecks directly in Venmo, and Southwest Airlines announced a new employee referral bonus.
Stocks were slightly lower at the open on Wednesday with the Dow falling by 33 points, or just under 0.1%. The S&P 500 and Nasdaq both dropped 0.1%.
Lowe’s shares are up more than 10% at the time of writing following the home improvement retailer delivering an earnings beat. For the second quarter, Lowe’s reported earnings per share of $4.25 on revenue of $27.57 billion, versus estimates for earnings per share of $4.01 on revenue of $26.85 billion. “Our strong results this quarter demonstrate that our Total Home strategy is working, with U.S. sales comps up 32% on a two-year basis,” Lowe’s CEO Marvin R. Ellison said in the earnings release. “In the quarter, we drove 21% growth in Pro, 10% growth in Installation Services and strong comps across Décor product categories. On Lowes.com, sales grew 7% on top of 135% growth last year. We also delivered significant operating margin expansion through our disciplined focus on driving productivity across the company.”
In other earnings news, Target said sales rose in every merchandise category in the second quarter. The big-box retailer posted earnings per share of $3.64 on revenue of $25.16 billion, beating analysts’ expectations for earnings per share of $3.49 on revenue of $25.08. “In the second quarter, our business generated continued growth on top of record increases a year ago, reinforcing Target’s leadership position in retail. We’ve spent years building and investing in the durable model we have today, which is supported by a differentiated strategy and the best team in retail,” CEO Brian Cornell said in a statement. “Even after unprecedented growth over the last two years, we see much more opportunity ahead of us, and we’re leaning into opportunities to invest in the long-term growth and resiliency of our business. Our team and operating model can seamlessly adapt to changes in the environment, and we’re well-positioned to deliver outstanding performance in the back half of the year.”
Tesla shares are up 4% this morning even after two Democratic lawmakers asked the FTC to investigate the company over its advertising of its Autopilot and Full Self-Driving (FSD) technology. Senators Richard Blumenthal, D-Conn, and Ed Markey, D-Mass, requested in a letter to FTC Chair Lina Khan for a probe into Tesla for “potentially deceptive and unfair practices” in its marketing of those technologies. “We fear that Tesla’s Autopilot and FSD features are not as mature and reliable as the company pitches to the public,” the Senators wrote. “Tesla and Mr. Musk’s repeated overstatements of their vehicle’s capabilities—despite clear and frequent warnings—demonstrate a deeply concerning disregard for the safety of those on the road and require real accountability. Their claims put Tesla drivers—and all of the traveling public—at risk of serious injury or death. In light of these concerns, we urge you to swiftly open an investigation into Tesla’s repeated and overstated claims about their Autopilot and Full Self-Driving features and take appropriate enforcement action to prevent further injury or death as a result of any Tesla feature”
PayPal and Fiserv announced a new partnership to allow paycheck deposits into users’ Venmo wallets. “The use cases that this can support are a 1099 (independent contractor) payment for a gig economy worker, a claim payment for an insurance company, a tax refund from the federal government and more,” Nandan Sheth, global head of payments at Fiserv, said in a statement. “It’s a combination of convenience and real-time payment experience combined together for the consumer.” PayPal’s senior vice president of partnerships, Dan Leberman, said, “With more than 400 million active accounts on the PayPal and Venmo platforms, we are able to provide companies with a fast, easy, and cost effective way to send money. This integration is the next step in our long-standing partnership with Fiserv and will provide substantial value to enterprises that need to send money directly to customers.”
And Southwest Airlines announced staff referral bonuses as the carrier struggles to hire new workers amid a rebound in travel demand. Southwest staff can receive 20,000 “SWAG Points,” worth about $300, redeemable for frequent flyer miles, gift cards, or concert tickets. “Southwest is experiencing a sharp decline in qualified applicants due to low labor force participation and competition for available talent,” Southwest vice president and chief people officer Julie Weber said in a note to staff announcing the bonus.
Stocks We’re Watching
Gritstone Bio Inc (NASDAQ: GRTS): Gritstone Bio announced yesterday that it has entered into a funding agreement worth up to $20.6 million with the Coalition for Epidemic Preparedness Innovations (CEPI) to advance the development of Gritstone’s CORAL COVID-19 vaccine program with an initial focus in South Africa. “Our unique approach combines our self-amplifying mRNA platform with a broad set of viral antigens beyond spike intended to drive robust and durable immune responses comprising both neutralizing antibodies and CD8+ T cells. With this unique antigenic breadth, our CORAL vaccine may offer protection against emerging spike variants of SARS-CoV-2 that appear challenging for first generation vaccines,” Andrew Allen, M.D., Ph.D., co-founder, president and chief executive officer of Gritstone, said in a press release. “We are honored to be supporting CEPI in their mission to help find new vaccine solutions to battle this deadly virus on a global scale and help prevent current and perhaps future COVID outbreaks.”