Warner Bros. Discovery Warns of $500 Million Hit From Hollywood Strikes
57 minutes ago
Warner Bros. Discover (WBD) shares rose as the entertainment giant’s update on its free cast flow and debt payments helped offset concerns about a negative impact to its earnings from Hollywood strikes.
Warner Bros. Discovery raised its 2023 free cash flow guidance to at least $5 billion, and expects it to exceed $1.7 billion in the current quarter because of the success of its blockbuster Barbie movie.
However, Warner Bros. Discovery also warned in a regulatory filing that the ongoing strikes by the Writers Guild of America (WGA) and Screen Actors Guild-American Federation of Television and Radio Artists (SAG-AFTRA) would cut full-year earnings before interest, taxes, depreciation and amortization (EBITDA) by $300 million to $500 million, lowering its EBITDA outlook to a range of $10.5 billion to $11 billion. The company’s previous estimates assumed the walkouts would end in early September.
Shares of Warner Bros. Discovery have added about a quarter of their value this year.
-Bill McColl
Hot Homebuilder Stocks Tumble
1 hr 56 min ago
Homebuilders were some of the S&P 500’s worst-performing stocks Tuesday. PulteGroup Inc. (PHM) fell more than 5.5% while Lennar Corp. (LEN) and D.R. Horton Inc. (DHI) each lost 5%.
The stocks have rallied this year on the back of mortgage rates at 20-year highs, which have locked existing homeowners into the loans they secured when rates were much lower and starved the housing market. In the second quarter of this year, a record 31.4% of all homes for sale were new construction.
Arm Expected to Be Biggest U.S. IPO So Far This Year
3 hr 9 min ago
U.K.-based chip designer Arm is looking to raise up to $4.87 billion in the largest U.S. initial public offering (IPO) of the year—one which could value the company at as much as $52 billion.
The company said in a Form F-1 filing with the SEC on Tuesday it will list 95.5 million American depositary shares (ADSs), or shares of a foreign company listed in the U.S., on the Nasdaq, with each valued between $47 and $51.
The IPO could raise anywhere from $4.49 billion to $4.87 billion, making it a bigger deal than Johnson and Johnson’s (JNJ) Kenvue (KVUE) spinoff earlier this year.
While the U.S. IPO market has bounced back slightly from last year’s lows, activity remains far below its 2021 peak. The first half of 2023 saw just 63 IPOs in the U.S., up from 51 in the same period last year but well below a peak of 416 through all of 2021.
Proceeds have also fallen precipitously, to $10.1 billion in the first half from $155.8 billion in 2021, according to an EY report.
-Mack Wilowski
Novo Nordisk Becomes Europe’s Most Valuable Company as Wegovy Launches in UK
4 hr 3 min ago
American depositary receipts of Novo Nordisk (NVO) climbed 1.5% in early trading on Tuesday after launching its popular weight-loss drug, Wegovy, in the U.K.
Novo Nordisk ADRs were up more than 40% year-to-date as demand for its weight-loss treatments surged, pulling ahead of LVMH to become Europe’s most valuable company by market capitalization.
The final price agreed with NHS is yet to be disclosed. In the U.S., the drug is available for $1,350 per dose once a month, while in Europe, it is available for around 170 to 300 euros ($190-$330) per month.
With supply constraints, it could take a few years before Novo ramps up enough production to satisfy demand. The company has taken measures to limit its availability in the U.S. and Germany. It also recently bought Embark Biotech to enhance its range of weight loss treatments.
-Fatima Attarwala
Oil Futures Spike as Saudi Arabia Extends Production Cut
4 hr 43 min ago
Crude oil futures contracts jumped 2% Tuesday morning after Saudi Arabia said it is extending its voluntary production cut until the end of the year.
The country, one of the world’s largest producers and exporters of oil, first cut production by 1 million barrels a day in July and had been renewing that decision on a monthly basis before Tuesday’s announcement. It has been joined by other Organization of Petroleum Exporting Countries (OPEC) and OPEC+ members, which also cut production by a cumulative 1.6 million barrels a day earlier this year.
West Texas Intermediate contracts jumped to $87.21 and Brent crude contracts climbed as high as $90.58, the highest price for both benchmarks since last November.
Stocks Making the Biggest Moves Premarket
5 hr 33 min ago
Gainers:
- Airbnb Inc. (ABNB): Shares gained more than 5% after S&P Global announced it would add the short-term rental company to the S&P 500. It will be joined by private equity firm Blackstone Inc. (BX), which gained 4% premarket.
- Tower Semiconductor Ltd. (TSEM): The semiconductor maker’s shares gained 3% after it struck a deal with Intel Corp. (INTC) to use Intel’s New Mexico manufacturing facility. Intel in August scrapped its deal to acquire Tower Semiconductor for over $5 billion after it failed to gain approval from Chinese regulators.
- Oracle Corp. (ORCL): Shares of the software provider gained 2% after Barclays upgraded the stock to Overweight from Equalweight and raised its price target to $150 from $126, citing growth in its SaaS and cloud business.
Losers:
- Vinfast Auto Ltd. (VFS): Shares of the Vietnamese electric vehicle maker, which listed on the Nasdaq last month, lost 18%, bringing the stock back down to earth after jumping more than 800% in its first weeks of trading.
- Li Auto Inc. (LI): The Chinese EV maker’s American depositary receipts (ADRs) fell 4% despite announcing it delivered more cars last month than it had forecast.
- Trip.com Group Ltd. (TCOM): Shares of the Chinese travel services provider lost 3%, falling alongside other Chinese stocks even after it reported 180% revenue growth in the most recent quarter.
5 Things to Know Before Markets Open
6 hr 7 min ago
Here’s what investors need to know to start their day:
- Shares of vacation rental platform Airbnb (ABNB) moved higher by 5% and shares of investment firm Blackstone (BX) gained 4% in pre-market trading after S&P Dow Jones Indices said it would add the two companies to the S&P 500 index on September 18.
- Walt Disney (DIS) said that customers of Charter Communications Spectrum Cable (CRTR) should sign up to Hulu as it continues to negotiate a broadcasting deal with the cable TV provider.
- Mercedes-Benz introduced a new electric vehicle (EV) sedan with a range of more than 466 miles, better than the 391-mile range of Tesla’s long-range Model 3 sedan.
- Shares of Albemarle (ALB) rose more than 1% in pre-market trading after the board of Australian lithium miner Liontown Resources backed a $4.3 billion takeover bid.
- Factory orders are expected to have fallen 2.3% in July after rising 2.3% the month before. That data is to be released by the Census Bureau at 10 a.m. ET.
-Terry Lane
Futures Slip to Start Shortened Week
6 hr 28 min ago
Futures contracts connected to the Dow Jones Industrial Average were down 0.05% in premarket trading on Tuesday.
S&P 500 E-mini futures contracts were down 0.15%.
Nasdaq 100 futures fell 0.3%
