
Daily US Equity Opening News - Starboard acquires QRVO stake; TFC gain on earnings beat; HOOD named top pick at MS
TODAY'S AGENDA:
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DAY AHEAD: US industrial production is expected to grow +0.3% M/M in December (prev. -0.1%), while manufacturing output is seen +0.2% M/M (matching the prior). The CBO will release its Budget and Economic Outlook in the afternoon. On the energy front, Baker Hughes will report weekly rig count stats. On the CRA slate, Fitch Ratings may review Estonia's Credit Rating (currently A+). No Fed speakers are currently scheduled to speak today ahead of the pre-meeting Blackout window, which begins on January 18th, ahead of its January 29th confab. -
BROKER MOVES: CRM upgraded at TD Cowen; SPOT downgraded at Wolfe Research on revenue forecasts looking "full". For the full list, please click here.
EQUITY NEWS:
TECH
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AI Demand Outlook - DigiTimes reports that AI cloud computing is expected to remain a primary growth driver for the tech industry in 2025, however, demand for consumer AI applications is mixed, depending largely on whether users are persuaded to upgrade their devices. -
Intel (INTC) - Is an acquisition target, according to SemiAccurate citing sources. The authors of the piece note about two months ago, SemiAccurate was read an email about a Co. trying to acquire Intel, whole. "We have absolute faith in the accuracy of this email but it took months to confirm it." -
Nvidia (NVDA), TSMC (TSM) - Nvidia's GB200 remains in high demand despite market concerns, DigiTimes reports. The publication notes that the TSMC CEO dismissed rumours of Nvidia reducing demand for Chip-on-Wafer-on-Substrate (CoWoS) packaging, and both companies are continuing to thrive amidst the AI boom, with TSMC maintaining CoWoS equipment orders despite concerns. Nvidia CEO, when asked if he has discussed new US AI export rules with Trump admin, says "not yet"; had a "great lunch" with TSMC (2330 TT/TSM) CEO -
TSMC (TSM - CEO said the chipmaker's new US plant is unlikely to get the most advanced chip tech before factories in Taiwan due to complex compliance issues, local construction regulations, and various permitting requirements. -
Apple (AAPL) - Set to launch a new HomePod in 2025 featuring an LCD screen instead of the previously speculated OLED technology, DigiTimes reports. The LCD panel will be supplied by Tianma Microelectronics in China, with Taiwan's Radiant Optoelectronics joining the supply chain. -
Qorvo (QRVO) - Activist investor Starboard Value has acquired a 7.7% stake in chipmaker Qorvo, worth USD 500mln, aiming to improve its share price it sees as "undervalued". Details of Starboard’s plans remain unknown, with a securities filing expected to confirm the stake, Reuters reports. -
Western Digital (WDC) - Sees Q2 adj. EPS at the lower end of its USD 1.75-2.05 guidance range (exp. 1.82), and sees revenue around the mid-point of its USD 4.20bln-4.40bln guidance range (exp. 4.24bln). Says Wissam Jabre is to step down as CFO of HDD business. -
Lyft (LYFT) - A federal judge dismissed a shareholder lawsuit against Lyft over a 2024 earnings report error, ruling that there was no intent to defraud investors. The case involved a corrected profit margin statement that briefly inflated Lyft's stock price. -
Salesforce (CRM) - Upgraded to 'Buy' from 'Hold' at TD Cowen with a PT of USD 400 (prev. 380); said its IT survey screened favourable for Salesforce, while its recent checks have been "highly constructive" on interest levels of Agentforce, seeing "several new growth levers emerging" in the model for 2025 and 2026. -
GlobalFoundries (GFS) - Plans to create a new centre for advanced packaging and testing of US-made essential chips within the NY manufacturing facility.
COMMUNICATIONS
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ByteDance - Senate Majority Leader Chuck Schumer urged President Biden to delay TikTok's ban deadline to allow finding a US buyer, citing national security concerns over Chinese ownership. Republicans opposed the extension, and the Supreme Court's ruling is awaited. Separately, TikTok, Shein, Xiaomi, and three other Chinese Cos. have been named in a privacy complaint filed by Australian advocacy group Noyv, alleging the firms were unlawfully sending European Union user data to China. -
Altice USA (ATUS), MSG Networks (SPHR) - Altice USA's Optimum has demanded MSG Networks refund over USD 125mln for the ongoing blackout of Knicks, Rangers, Islanders, and Devils games. Optimum claims MSG Networks has refused solutions and continues to deflect responsibility for the blackout. MSG Networks demanded Altice USA either offer the same deal as YES Networks or restore their previous agreement, and refund subscribers USD 10 a month for the lack of programming, including a USD 5 refund for January's shortfall. MSG added that Altice USA should 'cut the BS.' -
Spotify (SPOT) - Downgraded at Wolfe Research to 'Peer Perform' from 'Outperform', removing its prior USD 560 PT. The firm contends revenue forecasts look "full" following price hikes, marketing cuts, and developed markets beginning to saturate. -
Netflix (NFLX), Amazon (AMZN), Disney (DIS), Paramount (PARA), Comcast (CMCSA) - Streaming giants like Netflix, Amazon, Apple, and others will broadcast a charity concert on January 30th to raise funds for Los Angeles wildfire victims. The event will also air in theatres. -
Sony (SONY) - Cancelled unannounced live service PlayStation games from its Bend and Bluepoint studios, previously aimed at generating recurring revenue, Bloomberg reports. The company did not confirm if the cancellations would lead to closures or layoffs. -
Meta Platforms - Upcoming "Community Notes" is said to not apply to paid ads when they arrive later this year, via Reuters citing a person familiar with the matter. -
Nintendo (NTDOY) - Cos. announcement of the Switch 2, set for release later in 2025, disappointed investors due to the lack of details on price, launch date, and specifications, and its share price slipped 4.5% overnight. The design appeared more of an update than a reinvention.
FINANCIALS
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State Street Corp (STT) Q4 2024 (USD): Adj. EPS 2.60 (GAAP 2.46) (exp. 2.43), Revenue 3.41bln (exp. 3.32bln). Net interest income +10% y/y to 749mln (exp. 736.9mln), Provision for credit losses -40% y/y to 12mln (exp. 15.2mln), AUM -0.4% Q/Q to 4.72tln (exp. 4.88tln), CET1 ratio 10.9% (prev. 11.6% Y/Y, exp. 11.4%). Guidance: FY25 NII roughly unchanged Y/Y (exp. +2.6%), FY25 fee revenue seen +3-5% Y/Y, FY25 expenses seen +2-3% Y/Y (exp. +3.5%). -
Truist Financial (TFC) Q4 2024 (USD): Adj. EPS 0.91 (exp. 0.88), Revenue 5.11bln (exp. 5.05bln), NIM 3.07% (exp. 3.06%). Guidance: Q1 adj. revenue down about 2% Q/Q; FY25 adj. EPS +3.0-3.5% (exp. 2.4%), FY adj. rev +3-3.5%, FY net charge-off ratio about 60bps. -
Citizens Financial (CFG) Q4 2024 (USD): Adj. EPS 0.85 (exp. 0.83), Revenue 1.98bln (exp. 1.96bln), NII 1.412bln (exp. 1.39bln), Provision for credit losses at 162mln. Guidance: Q1 NII -1.5% to -2.5% (exp. -1.1%), Expects buybacks in the period; FY25 NII +3% to +5%. -
KKR & Co. (KKR) - Appointed Goldman Sachs to sell its significant minority stake in Philippine fintech Co. Maya, which is valued at over USD 2bln. KKR owns more than 20% of Maya, a digital bank with 5.4mln customers. -
UBS Group (UBS) - Received a waiver from the US Department of Labor, enabling the bank to continue managing US retirement plans despite a paperwork error. The waiver is valid until June 2029. -
Crypto - President-elect Trump plans to issue an executive order prioritising cryptocurrency as a national policy, creating a crypto advisory council to advocate for industry interests. The order aims to direct government agencies to collaborate more closely with the crypto sector. -
Regions Financial (RF) Q4 2024 (USD): EPS 0.56 (exp. 0.55), Revenue 1.82bln (exp. 1.86bln). -
TPG (TPG) - TPG, Rosatom, and Transneft won their bid to block jailed tycoon Ziyavudin Magomedov's USD 14bln London lawsuit over an alleged conspiracy to strip his assets, Reuters reports. -
Robinhood Market (HOOD) - Named top pick at Morgan Stanley. -
Insignia Financial (IOOFF) - CC Capital raised its bid for Insignia Financial to AUD 4.60/shr, surpassing Bain Capital's AUD 4.30/shr offer, The Australian reports. Insignia's board is reviewing the proposal, with Brookfield possibly entering the fray too. The deal values Insignia at over USD 3bln. -
Assicurazioni Generali SpA (ARZGY), Natixis SA (NTXFY) - The two financial companies are reportedly close to announcing an agreement to form a 50/50 asset management JV, FT reports.
CONSUMER DISCRETIONARY
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Starbucks (SBUX) - Mellody Hobson will step down from Starbucks’ board after 20 years, citing confidence in the Cos. direction under CEO Brian Niccol, who took over in September and is working to revitalise growth through café improvements and faster service. -
General Motors (GM) - Settled with the FTC after allegations that it shared drivers’ location and behaviour data without consent, WSJ reports. The agreement prohibits GM from disclosing this data to consumer reporting agencies for five years. Meanwhile, NHTSA's ODI opened a preliminary investigation into around 878k General Motors vehicles over loss of power due to engine failure. -
Rivian (RIVN), Plug Power (PLUG) - The Biden admin finalised USD 6.6bln for Rivian's Georgia plant, and USD 1.66bln for Plug Power hydrogen projects, securing funds before President-elect Trump assumes office. -
Mattel (MAT) - Announced that CFO Anthony DiSilvestro will retire on May 15th, and will assist in the transition until August 15th. -
FIGS (FIGS) - Rebuffed PE firm Story3 Capital Partners' offer to acquire the company, after last month's offer of USD 6/shr (closed Thursday at USD 6.12/shr).
MATERIALS
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Rio Tinto (RIO), Glencore (GLNCY) - Rio Tinto and Glencore held early-stage talks on a potential merger, which would create the largest mining company rivalling BHP. FT suggests that the discussions ended without progress, with concerns over Glencore's coal assets and limited synergy benefits for Rio. -
Copper Prices - Bloomberg notes that copper is on track for its longest winning streak since 2017, rising to over USD 9,200/tonne. The rally follows positive economic data from China, where GDP growth reached 5% in 2024, bolstered by strong activity in the final quarter. -
China Materials - China achieved record production in 2024 for coal, gas, and aluminium, while steel output declined but remained above 1bln tonnes for the fifth consecutive year. These figures highlight China's focus on energy security and the transition towards greener industries. -
ICL Group (ICL) - ICL signed a JV with Shenzhen Dynanonic to produce lithium iron phosphate for the European market. The EUR 285mln investment will fund a new facility at ICL's Sallent, Spain, site, with ICL holding 80% ownership. -
Lynas Rare Earths (LYC AT) - Missed forecasts for Q2 revenue warning that it expected tough market conditions to prevail in the coming quarter on subdued demand from China.
INDUSTRIALS
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Fastenal Co (FAST) Q4 2024 (USD): EPS 0.46 (exp. 0.48), Revenue 1.82bln (exp. 1.84bln); FY net capex view 235-255mln (exp. 226.2mln); Operating margin 18.9% (exp. 19.7%). Commentary: December was a story of two halves. -
China Shipbuilding - A US government investigation has found that Chinese subsidies unfairly support the country's shipbuilding industry, harming American competitors. This decision could lead to the imposition of tariffs, with China accused of using policies to depress costs and gain market dominance, BBG reports. -
Palantir (PLTR) - Is in talks to invest in Shield AI, a drone startup valued at USD 5bln, as part of its strategic focus on AI in defence. Other investors reportedly include Airbus (EADSY), L3Harris (LHX), and notable venture capital firms. -
Boeing (BA) - Resumed flight testing for its 777X jet after a five-month hiatus caused by an engine mounting issue. The 777X, originally slated for delivery in 2020, now has a delivery target of 2026. Separately, according to sources cited by Reuters, investigators found bird feathers and blood in both engines of the Jeju Air 737-800, which crashed in South Korea in December, killing 179 people; the bird strike occurred minutes before the crash, and the plane's black boxes stopped recording shortly before the incident. -
J.B. Hunt (JBHT) Q4 2024 (USD): EPS 1.53 (exp. 1.62), Revenue 3.15bln (exp. 3.15bln). Revenue fell due to a 6% decline in revenue per load, offset by volume growth. Operating income dropped 10%, affected by lower yields and higher repositioning and labour costs. JBI segment operating income as a percentage of revenue also decreased due to higher labour and equipment costs. Intermodal volume rose +5% Y/Y, with transcontinental and eastern network loads increasing +4% and +6%, respectively. -
Otis Worldwide (OTIS) - Board authorised a USD 2bln share repurchase programme, starting January 16th. The new plan replaced the remaining USD 100mln from the previous programme.
ENERGY
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Arctic Drilling - The Biden admin has moved to limit oil drilling in Alaska’s National Petroleum Reserve, aiming to secure conservation protections ahead of President-elect Trump's inauguration. The step is part of broader efforts to block extensive oil and gas development on federal lands and waters. -
Philippines Gas Projects - US Cos. are exploring oil and gas projects in the Philippines, with interest in areas far within the archipelago, as tensions with Beijing hinder exploration in disputed South China Sea regions, BBG said. Philippine Energy Secretary confirmed the discussions but withheld company names pending commitments. -
Valero Energy (VLO) - Increased quarterly cash dividend 5.6% to USD 1.13/shr. -
SLB (SLB) Q4 2024 (USD): EPS 0.92 (exp. 0.90), Revenue 9.284bln (exp. 9.18bln), Adj. EBITDA 2.382bln (exp. 2.351bln); announced USD 2.3bln accelerated share repurchase programme and raising its quarterly dividend by 3.6% to USD 0.285/shr
HEALTHCARE
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Amgen (AMGN) - The FDA approved the firm's Lumakras in combination with Vectibix to treat adult patients whose cancer has spread to other parts of the body despite receiving chemotherapy, Reuters reports. -
Weight Loss Drugs- US FDA Chief said current regulations are not enough to protect Americans from the risks of compounded GLP-1 drugs. -
Boston Scientific (BSX) - Presented data at AF Symposium 2025, supporting the FARAPULSE Pulsed Field Abltion System for treating persistent AF and the WATCHMAN FLX device for reducing bleeding risks in atrial fibrillation patients, showing a 44% reduction in non-procedural bleeding. -
AstraZeneca (AZN) - FDA approves acalabrutinib with bendamustine and rituximab for previously untreated mantle cell lymphoma. FDA also granted traditional approval to acalabrutinib as a single agent for adults with previously treated MCL. -
Medicare - The US government said Medicare has selected 15 additional drugs to negotiate directly with partaking drug companies. Selected drug list for the second cycle of Medicare price negotiations including Novo Nordisk's (NOVOB DC) Ozempic, Rybelsus & WeGovy, GSK's (GSK LN) Trelegy and Astellas Pharma's (4503 JT) Xtandi.
UTILITIES
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Vistra (VST) - A fire broke out at the battery facility on Vistra's Moss Landing power plant in Monterey County, California, with 40% of the building consumed as of late Thursday containing lithium-ion batteries. Monterey Country officials noted, No active fire suppression is taking place, the batteries must burn themselves out,”; “No water can be used. This is standard action for battery fires.” -
Consolidated Edison (ED) - Raised quarterly dividend to USD 0.85/shr (prev. 0.83/shr).
REAL ESTATE
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Greystar - The FTC and Colorado have filed a complaint against Greystar, accusing the rental property manager of adding hidden fees to rents since at least 2019, WSJ said. These fees, which were often discovered post-lease, allegedly cost consumers hundreds of millions of dollars.
CONSUMER STAPLES
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Dairy - New Zealand urged Canada's incoming prime minister to address concerns from dairy exporters accusing Canada of dumping low-priced milk on global markets. Trade Minister Todd McClay emphasised the government's shared concern and called for action to halt these practices.
17 Jan 2025 - 13:59- EquitiesData- Source: Newsquawk
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