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Broadcom Says Chip Orders Require Six Months’ Lead Time

Thu, 04/16/2020 - 15:27

(Bloomberg) -- Broadcom Inc., a chipmaker that supplies crucial components for Apple Inc.’s iPhone, told customers that disruptions to the global supply chain caused by the Covid-19 pandemic means they’ll need to place orders for parts six months ahead of time.Lockdowns in Malaysia, Thailand, Singapore and the Philippines are “closing or severely restricting business operations,” according to a letter to customers from Nilesh Mistry, Broadcom’s vice president of sales, dated April 13 and seen by Bloomberg. “Air and sea transport options have become unreliable and become more expensive and have increased delays,” Mistry wrote. The San Jose, California-based company declined to comment.Broadcom is a critical part of the supply chain for products ranging from mobile phones to data-center hardware. Any delays in the delivery of its semiconductors could spread throughout that supply network, potentially leading to missed launches of some of the world’s most high-profile and widely used electronic devices.Wireless customers include Apple and Samsung Electronics Co., which use Broadcom chips to add Wi-Fi and other connectivity to some of the world’s best-selling smartphones. In networking, its switch chips are the market leaders, going into machinery that’s used by all of the biggest equipment makers, including Cisco Systems Inc. and Huawei Technologies Co., and companies such as Amazon.com Inc. that build their own gear.The chipmaker’s letter to customers didn’t specify which products are experiencing delayed shipments and what the normal lead time is between orders and delivery, compared with the 26 weeks specified in the letter.“We hope that as the global community finds better methods to address the Covid-19 pandemic, the conditions will abate and we will be able to resume our normal operations,” Mistry said in the letter.Broadcom is part of the same supply chain that most of the world’s chipmakers use to outsource production, testing and packaging of their products. Products from companies such as Qualcomm Inc., Nvidia Corp. and Advanced Micro Devices Inc. are built mostly by Taiwan Semiconductor Manufacturing Co., then tested and packaged by other companies in China and Southeast Asia. Some companies perform elements of the process in-house, and a shrinking group are capable of doing all the steps themselves.On March 12, Broadcom withdrew its annual sales forecast and gave weak near-term guidance, citing the impact of the pandemic. Chief Executive Officer Hock Tan told investors that, while fundamental demand was still strong and he hadn’t see any negative impact in the first quarter of the year, “visibility was lacking.”As part of a bond offering last week, Broadcom warned investors that it was experiencing some disruption to parts of its global supply chain. In the “related risks” section of a regulatory filing, the company highlighted that a main warehouse and a number of assembly and test subcontractors are in Malaysia, which has shut down all non-essential businesses. The warehouse is fully operational, but “many of the facilities of our suppliers and service providers are not,” the company said at the time.“An extended closure of these facilities may require us to move assembly and test services to providers in other countries, and may, eventually, lead to a shortage of some components needed for our products,” Broadcom said. “In the event restrictive measures in Malaysia are intensified and our warehouse is shut down or required to operate at a reduced capacity, our ability to deliver product to our customers would be severely limited.”The test and assembly of chips includes coating them in protective plastic, adding electrical contacts that let them communicate with the rest of the device, and making sure they function. Such work is less expensive and easier to conduct than the processing of silicon wafers that make up the fundamental circuits of the chips. Much of the packaging work was shifted to countries with lower labor costs decades ago.(Updates with company warning on Malaysia facilities in ninth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.


We engineered this recession, the coronavirus didn't cause it: Bob Doll

Thu, 04/16/2020 - 15:22

Chief Equity Strategist at Nuveen Bob Doll joins Yahoo Finance’s Seana Smith to discuss his market outlook as coronavirus cases in the U.S. surpass 650,000, according to John Hopkins data.


Booking Holdings Applies for European Relief With Substantial Layoffs Possible

Thu, 04/16/2020 - 15:15

Booking.com terminated 48 contractors in Amsterdam when their agreements expired, and Glenn Fogel, CEO of that unit and its parent Booking Holdings, told employees in an internal video Friday that additional layoffs were certainly possible. Under the headline, "Dizzying"drop in turnover at Booking: layoffs on the way, Dutch site NRC reported on the video it […]


T-Mobile wins final approval for closed merger with Sprint

Thu, 04/16/2020 - 15:09

California's Public Utilities Commission (CPUC) voted on Thursday to approve the merger of wireless carriers T-Mobile US Inc and Sprint Corp, marking the final approval for a $23 billion deal which closed on April 1. The deal had closed without a final decision from the California PUC, which gave that on Thursday with a unanimous vote. The CPUC had issued a proposed decision in March to approve the merger with conditions.


Why Long-Term Bets on MGM Stock Are a Bad Idea

Thu, 04/16/2020 - 15:05

The market has been dealing bullish investors the equivalent of a full house lately. But when it comes to MGM Resorts (NYSE:MGM), overstaying one's welcome or anteing up today, looks like a long-term losing proposition. Here's why you need to be cautious about MGM stock.Source: Jason Patrick Ross / Shutterstock.com Since ending its record-breaking losing streak in late March, the market has been on a tear. Thankfully a debilitating low has been confirmed as a major market bottom. It was no easy feat. And gains as much as 30% earlier this week in the S&P 500 have solidified the case for an emerging bull market in the aftermath of a novel coronavirus-driven correction.Unsurprisingly, the swift and powerful rally has lifted share prices from Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) to Zynga (NASDAQ:ZNGA) and most every company in-between. And MGM stock is no exception.InvestorPlace - Stock Market News, Stock Advice & Trading TipsOver the last three-plus weeks, MGM has delivered an even larger jackpot-like return of around 135% from its absolute low of $5.90 on March 18. That's more than four-fold the S&P 500's monster performance. And at MGM stock's absolute bear-crushing best, investors were sitting on gains of 178%. But for the casino operator's longer-term shareholders, it's now time to know when to fold them as the late Kenny Rogers crooned in his famous ballad. * 9 Robust Stocks to Buy to Survive a Bear Market The good news for many companies is the U.S. could be open for business sooner rather than later. But the impact of the COVID-19 pandemic and a "new social-distanced normal" doesn't bode well for MGM with its existing cramped, high-contact tables and one-armed bandits. The company's domestic operations and those in other key markets like Macau are going to pay the price as average consumers rightfully take a big step back from riskier social environments. And its not just Joe Schmo and his family either. How about those famously massive corporate trade shows and other high-profile spectacles that MGM profits from? There's more lost revenues for MGM to be certain.If misery loves company, MGM isn't alone. The industry is between a rock and a hard place. Peers Wynn Resorts (NASDAQ:WYNN) and Las Vegas Sands (NYSE:LVS) are obviously in trouble as well. That's even if MGM and other casinos clean up their acts to a new and still-pending letter of the law. But truthfully, that's a double-edged sword isn't it? The thing is, it doesn't take a MBA to know MGM and Sin City are in for a difficult road ahead trying to lure in individuals and businesses alike in a hands-off and sanitized post-coronavirus world. MGM Stock Monthly Stock Chart Source: Charts by TradingViewAs indicated above, casino stocks LVS and WYNN are faced with similar sales challenges that will negatively impact earnings in the coming quarters and possibly much longer. But MGM stock stands ominously apart on the price chart too.During the broader market correction, shares of MGM were hit harder in one eye-catching way than either Las Vegas Sands or Wynn Resorts. The longer-term monthly chart shows a clean and decisive break of uptrend support dating back to the financial crisis. By comparison, both other casino stocks are still clinging in volatile price action with their own long-term support lines. It's another concern for the sustainability of MGM's rally. And if three is a crowd, MGM is the casino stock to drop.For MGM investors that are already positioned long, the suggestion is to cash out today. With the fallen trend line, shares sandwiched tenuously in between the 62% and 76% Fibonacci retracement levels and stochastics have yet to show signs of firming, the path of least resistance is down. If that advice sounds too critical, a move back below $11.50 certainly looks like sufficient visual evidence to exit as shares fail the March closing low.For investors looking to place a bet on green in MGM stock, I'd stress waiting. Technically, if the stock can hold above $11.50 over the remainder of April and stochastics begin to firm up, the bull case will improve on the price chart. From there, and just maybe in a post-coronavirus world, come May or June, there might be more definitive reasons to allocate some risk capital into MGM stock.Investment accounts under Christopher Tyler's management do not own positions in any securities mentioned in this article. The information offered is based upon Christopher Tyler's observations and strictly intended for educational purposes only; the use of which is the responsibility of the individual. For additional market insights and related musings, follow Chris on Twitter @Options_CAT and StockTwits. More From InvestorPlace * America's 1 Stock Picker Reveals Next 1,000% Winner * 25 Stocks You Should Sell Immediately * 1 Under-the-Radar 5G Stock to Buy Now * The 1 Stock All Retirees Must Own The post Why Long-Term Bets on MGM Stock Are a Bad Idea appeared first on InvestorPlace.


Nvidia gets China's go-ahead for $6.9 billion Mellanox deal

Thu, 04/16/2020 - 14:30

Mellanox shares rose nearly 2% in afternoon trading, while Nvidia jumped about 4%. Many acquisitions between U.S. and international companies with significant operations in China have faced challenges in securing approval from the country's regulator due to a bitter trade war between the two largest economies of the world that started in January, 2018. Two years ago, U.S. chipmaker Qualcomm Inc had to walk away from a $44 billion deal to buy NXP Semiconductors after failing to secure Chinese regulatory approval.


Jefferies Pounds the Table on Aphria (APHA) Stock

Thu, 04/16/2020 - 14:28

The results are in, and it looks like cannabis company Aphria (APHA) hit another ball out of the park. Unlike other heavy hitters in the space, this name has consistently impressed Wall Street with its performance, and its most recent quarter was no exception.According to its fiscal Q3 earnings report, which was released Tuesday, the company generated net revenue of CA$144.4 million, flying past the CA$131 million consensus estimate. Not to mention this number is up from CA$120.6 million in the previous quarter. Group adjusted EBITDA also didn’t disappoint. For the fourth consecutive quarter, the figure came in positive at CA$5.7 million. If that wasn’t enough, the average adult-use selling price got a boost on a quarter-over-quarter basis, growing from CA$5.22 per gram to CA$5.47 per gram.However, APHA did deliver an unwanted piece of news. The company hasn’t been able to escape COVID-19's grasp on the market, and as a result, management announced that it would suspend full year 2020 guidance.Covering the cannabis stock for Jefferies, analyst Owen Bennett isn’t surprised by the guidance suspension, but instead tells clients to focus on everything APHA has going for it. “First, cash levels are very healthy with no material debt maturities in the next 12 months and new capex projects ceased, meaning little liquidity risk even if the situation worsens. Second, Aphria go into this period of uncertainty with clear sales and earnings momentum that they should be able to resume. Thirdly, and to this, the company intend to re-instate guidance though concede this may not be until FY21,” he commented.Adding to the good news, Bennett believes that its strong execution, profitability, industry-best brand positioning and possible near-term positive newsflow make it a stand-out in a highly competitive industry. Expounding on this, the analyst stated, “The highlight for us has to be the demand that is evident for Aphria's products. In an industry where peers are seeing top-line pressures from spending the first 12 months of legalization filling the shelves, Aphria is having to source third-party product to try and keep up. Pushback maybe that wholesale shipments have increased but this was a tactic to offload lower potency THC products.”While bulk sales might not reach the same high level in the next quarter, Bennett argues that all of the above justifies his bullish stance. This prompted the analyst to not only reiterate his Buy rating but also call APHA his “top pick in the space.” In addition, his CA$10.00 (US$7.29) price target puts the upside potential at nearly 100%. (To watch Bennett’s track record, click here)What does the rest of the Street think about APHA’s long-term growth prospects? Based on 6 Buys and 1 Hold assigned in the last three months, the word on the Street is that this cannabis stock is a Strong Buy. Despite being less aggressive than Bennett’s forecast, the US$5.89 average price target indicates 67% upside potential. (See Aphria stock analysis on TipRanks)To find good ideas for cannabis stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.


U.S. rejects most Spirit, JetBlue requests to halt additional flights

Thu, 04/16/2020 - 14:11

The U.S. Transportation Department said on Thursday it had rejected most requests by Jetblue Airways Corp and Spirit Airlines to halt additional flights in the wake of the pandemic that has sent passenger traffic down by 95%. The department last week issued final rules setting minimum flights requirements for airlines receiving government assistance allowing airlines to dramatically cut and consolidate but not eliminate service. Spirit must resume flights to the New York City area and outstate New York airports after it suspended service to all New York, New Jersey and Connecticut airports it serves in early April, including New York LaGuardia, Newark, New Jersey; Hartford, Connecticut; Niagara Falls, New York, and Plattsburgh, New York.


Why Exxon Mobil Investors Should Ignore the OPEC+ Deal

Thu, 04/16/2020 - 14:09

Prior to the historic OPEC+ deal, Saudi Arabia shocked the global community when it engaged in a bitter oil price war with Russia. Naturally, this impacted the U.S. energy markets, particularly oil firms that were already deeply embattled. But the geopolitical rift also took down sector giants like Exxon Mobil (NYSE:XOM) and Chevron (NYSE:CVX). Fortunately, the much-needed deal made Exxon Mobil stock look much more attractive.Source: Jonathan Weiss / Shutterstock.com Or did it? While events can change in a hurry, the last few sessions following the agreed-upon production cuts have not been favorable for Exxon Mobil stock nor its key rivals. However, it's fair to point out that Wall Street is steadily digesting all available news. And because we're in unprecedented territory, no one should jump to conclusions based on a few sessions' data points.To further support the optimistic position, U.S. Energy Secretary Dan Brouillette told CNBC that oil prices may have hit a floor. He believes that the OPEC+ deal has done enough to mitigate the previously disastrous decline.InvestorPlace - Stock Market News, Stock Advice & Trading TipsOn paper, Brouillette has a point. When you look at the consumer price index in March for gasoline purchases, the 10.5% month-to-month loss is severe. In the year-ago period, CPI for gasoline increased 5.3%. * 9 Robust Stocks to Buy to Survive a Bear Market However, the recent downfall is nowhere near the worst that we've experienced. Back in January 2015, CPI for gasoline fell more than 16% month-to-month. Also, in November of 2008, the sector index tanked 31%. That's not to take away from the current crisis. Still, it's important to recognize that we've seen much worse and have recovered.So, does this give the green light for Exxon Mobil stock? Unfortunately, it does not. Exxon Mobil Stock Faces a Demand, Not a Supply CrisisAs I've pointed out in several oil-related stories for InvestorPlace, the crisis facing XOM and other players in the space is related to demand, not supply. Sure, cutting production may help inspire some trading sentiment. Ultimately, though, without consumers running their daily routines, no amount of supply cuts will appreciably change this narrative.Of course, many analysts point to the novel coronavirus or specifically, its economic impact as the biggest headwind facing Exxon Mobil stock. Certainly, with most states imposing stay-at-home orders, the governmental response has done nothing to help the broader oil industries. But that's only one part of the demand equation.In reality, the coronavirus isn't the culprit. Instead, it lit the match on a pool of flammable liquid that was already there for decades.Another indicator that investors should consider before buying Exxon Mobil stock is the CPI for new vehicle purchases. Since the 1990s, the sector CPI has been largely flat. For example, in April 1997, it registered 144.6 points. Last month, it hit 146.3 points. Click to Enlarge Source: Chart by Josh Enomoto Although the CPI isn't a perfect indicator of demand, it gives you a solid idea that Americans have not been willing to pay higher prices for new vehicles. Conversely, they were forced to pay exorbitantly high gasoline prices starting in the early 2000s that did not reflect reality.Therefore, I believe that coronavirus or not, we would have seen oil prices decline. Again, the pandemic has merely accelerated what we're just starting to realize: the erosion of demand for fossil fuels no longer justifies the extreme price thresholds that we saw in gasoline prices.If you're levered heavily to Exxon Mobil stock, you may want to consider trimming your exposure on spike highs. A Virus-Inspired SobrietyPersonally, Exxon Mobil stock is a frustrating investment. Prior to the Covid-19 pandemic, electric vehicle makers like Tesla (NASDAQ:TSLA) supposedly represented an existential threat to XOM. However, I believed at the time that the internal combustion engine had longer legs than EV bulls were giving the platform credit. Thus, I was bullish on the oil giants.However, the outbreak has forced me to reconsider everything. When I did, the data simply does not support the oil industry at this time. Click to Enlarge Source: Chart by Josh Enomoto I also pulled up the CPI for used vehicle purchases and compared it to gasoline CPI. What I discovered here was that demand for used vehicles has been declining since the 1990s. For instance, in November 1995, used vehicle CPI was 157.8 points. In March 2020, it's down to 138.7 points.Naturally, over the next several months, you'd expect demand for both new and used vehicles to deteriorate. Heck, CPI for all products not related to essentials like food, water and critical supplies should decline significantly. In this environment, it's just not feasible for Exxon Mobil stock to spark and sustain a recovery rally.A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare. As of this writing, he did not hold a position in any of the aforementioned securities. More From InvestorPlace * America's 1 Stock Picker Reveals Next 1,000% Winner * 25 Stocks You Should Sell Immediately * 1 Under-the-Radar 5G Stock to Buy Now * The 1 Stock All Retirees Must Own The post Why Exxon Mobil Investors Should Ignore the OPEC+ Deal appeared first on InvestorPlace.


Moderna’s COVID-19 Vaccine Potential Taking Shape

Thu, 04/16/2020 - 13:58

COVID-19 has put the world in a chokehold, but one biotech name appears to be well on its way to delivering a match-winning knockout.On Tuesday, Moderna (MRNA) hosted a virtual vaccines day in which management as well as infectious disease (ID) key opinion leaders (KOLs) highlighted scientific, regulatory and commercial considerations related to Moderna's vaccine programs, including its experimental vaccine against COVID-19, mRNA-1273. With respect to this candidate, Moderna expects to have initial Phase 1 immunogenicity data in the summer, and then to progress quickly into Phase 2. After a dose has been selected, Phase 2b/3 studies are slated to kick off in the fall.Weighing in for Chardan Capital, analyst Geulah Livshits cites several takeaways from the discussion that played into her bullish thesis. There are advantages to using an mRNA approach including ease of design, natural antigen expression, triggering of both B and T cell responses, activity at lower doses (vs. DNA vaccines) and cell-free standardized manufacturing. In addition, Moderna is ramping up its manufacturing might.It should be noted that the KOLs pointed out there’s a high level of uncertainty when it comes to SARS-CoV-2 immunity.“If...immunity is durable or recovered patients only experience mild disease upon re-infection, the long-term need for a SARS-CoV-2 vaccine could be limited, and the majority of commercial potential (if any) could come from stockpiling in 2021-22. We believe Moderna is relatively well-positioned in either scenario (if mRNA-1273 shows efficacy) given the company's accelerated clinical timeline,” Livshits explained.As a result, the analyst kept a Buy rating and $40 price target on the stock. (To watch Livshits’ track record, click here)Meanwhile, Oppenheimer’s Hartaj Singh believes its mRNA-1647 candidate in cytomegalovirus (CMV) represents a major point of strength for the company.“While mRNA-1273's nearer-term impact to the investment thesis is significant, we remain bullish on substantial opportunity from mRNA-1647 in CMV and the remainder of the core prophylactic vaccine portfolio. The complexity of CMV and its devastating morbidity/mortality to sub-populations are features of the unmet need that could uniquely be served by mRNA-1647's approach,” the analyst stated.If that wasn’t enough, interim Phase 1b data for its experimental Zika vaccine, mRNA-1893, demonstrated positive results.Based on everything that MRNA has going for it, Singh not only reiterated an Outperform call, but also bumped up the price target from $31 to $43. This new target implies shares could surge 15% in the next year. (To watch Singh’s track record, click here)Looking at the consensus breakdown, 8 Buys and 1 Hold issued in the last three months add up to a Strong Buy analyst consensus. (See Moderna stock analysis on TipRanks)To find good ideas for coronavirus stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.


Abbott beats Q1 earnings estimates, suspends 2020 guidance

Thu, 04/16/2020 - 13:17

Yahoo Finance’s Jared Blikre breaks down the latest market action in the healthcare sector.


IRS launches new tool, allows people who don’t file for unemployment to receive stimulus check

Thu, 04/16/2020 - 13:01

Another 5.24 million people filed for unemployment last week amid the coronavirus pandemic. Professor of Law at Seton Hall University School of Law Richard Winchester joins Yahoo Finance’s On The Move to discuss tax implementations on stimulus checks.


If the coronavirus-battered US economy doesn't reopen like Trump wants in May, stocks could be creamed

Thu, 04/16/2020 - 12:58

Has the stock market's rally come on too hard and fast? Some say yes, especially with the coronavirus continuing to linger as a major economic issue.


Nokia shares surge on report of takeover bid

Thu, 04/16/2020 - 12:56

"Nokia does not comment on market rumours," said a spokesman for the company. Earlier on Thursday shares in Nokia surged 12.5%, with traders pointing to a report by online newspaper TMT Finance that said the group was working to defend itself from a hostile takeover bid for parts or all of its business. The TMT Finance report said Nokia had hired Citi, a regular investment banking partner of the Finnish firm, for the deal which could be worth $17.4 billion.


Farmer says ‘frozen meat is maxed out right now’ over coronavirus crisis

Thu, 04/16/2020 - 12:49

The ongoing coronavirus pandemic hit already struggling farmers hard. Farmer & Rancher Hope Pjesky joins Yahoo Finance’s to discuss the agriculture industry and working conditions amid the virus.


Barbara Corcoran: Educated homebuyers can get the ‘deal of a lifetime’ right now

Thu, 04/16/2020 - 12:41

Is now a good time to buy a home? It might be, says Barbara Corcoran.


3 Compelling Penny Stocks With at Least 50% Upside Potential

Thu, 04/16/2020 - 12:02

Dark clouds are looming over Wall Street, and the storm only appears to be intensifying. The market was dealt another blow on Wednesday April 15, with all three of the major U.S. stock indexes sliding on grim economic data and disappointing earnings reports from banks.According to a Commerce Department report, March saw retail sales fall sharply, 8.7% to be exact. This marked the largest one-month drop since 1992, when the department began tracking the metric. Manufacturing in the New York area also declined by its largest margin ever, reaching a historic low to exceed levels witnessed during the Great Depression. Add in lackluster first quarter figures from Bank of America and Citigroup, and you have a recipe for heightened investor concern.Sure, the economic landscape appears gloomy, but if you look carefully, there’s a bright spot. COVID-19's worldwide rampage has slashed the price tags of some compelling names, providing attractive entry points.As a result, risk-tolerant investors have penny stocks on the mind. At under $5 per share, you get more bang for your buck and even minor share price appreciation can reflect huge percentage gains. However, due diligence is important here as Wall Street pros remind investors the bargain price could be a sign that a particular name faces overwhelming headwinds.Bearing this in mind, we used TipRanks’ database to pinpoint three Buy-rated penny stocks that have earned a thumbs up from members of the analyst community. Not to mention each boasts substantial upside potential of over 50%.AcelRx Pharmaceuticals (ACRX)AcelRx’s unique approach involves using a single-strength tablet in a distinct dosing unit to deliver drugs, which are designed to avoid the types of medication errors associated with injectable opioids. Shares have surged 53% in just the last month, but at $1.29 apiece, several analysts believe this stock is still undervalued.Writing for H.C. Wainwright, five-star analyst Ed Arce cites its Tetraphase Pharmaceuticals acquisition as a major positive. He argues that the deal could help ACRX establish a hospital-based commercial drug portfolio as Tetraphase’s only commercially available product, XERAVA, achieved Q4 sales of $1.5 million. As this result reflects a 49% sequential gain, Arce thinks “the drug is on a sustainable growth trajectory.”Arce doesn’t dispute the fact that there’s some concern surrounding Tetraphase’s financing risk and that its modest revenue and significant cost basis could signal a long path to profitability. “However, by combining DSUVIA and XERAVA net product sales under one streamlined cost structure, we believe the combined company may realize both revenue synergies (access to more areas across the hospital to promote both products) as well as more obvious cost synergies by removing duplication across operations, especially in sales and marketing,” he commented.Arce added, “Further, in addition to the acquisition which is expected to close in 2Q20 (see financial details below), the companies have agreed to enter a co-promotion arrangement effective immediately. As such, the companies plan to eliminate about 40 sales positions immediately (roughly half from each company), which provides an immediate cost savings of $8 million annually, before additional efficiency benefits from the acquisition itself.”To this end, Arce stayed with the bulls, reiterating a Buy recommendation. That being said, he did trim the price target from $9 to $7, but this still leaves room for 443% upside potential. (To watch Arce’s track record, click here)All in all, the rest of the Street is on the same page. Receiving 3 Buys and 1 Hold over the last three months, ACRX earns a Strong Buy consensus rating. At $1.29, the average price target implies shares could soar 381% in the next twelve months. (See AcelRx stock analysis on TipRanks).OPKO Health, Inc. (OPK)Hoping to address the unmet needs of patients, OPKO Health has developed innovative products, comprehensive diagnostics laboratories, a robust research and development pipeline and unique pharmaceutical business solutions to achieve this goal. With a price tag of $1.63 per share, analysts believe that now is the time to pull the trigger.Part of the excitement surrounding this healthcare name is related to the interim results of two clinical studies for its Rayaldee therapy. On March 25, OPK published data from a Phase 4 clinical trial evaluating Rayaldee compared to three other treatment regimens for secondary hyperparathyroidism (SHPT) in adult patients with stage 3 or 4 chronic kidney disease (CKD) and vitamin D insufficiency and a Phase 2 clinical trial of Rayaldee for SHPT in adult patients with stage 5 CKD who need hemodialysis and have vitamin D insufficiency.The Phase 4 trial results were encouraging as they showed that at the given dose, the therapy could increase serum total 25-hydroxyvitamin D to the level required to effectively suppress elevated plasma intact parathyroid hormone (iPTH) in CKD patients. Not to mention the drug showed a robust safety profile.As for the Phase 2 trial, Laidlaw analyst Yale Jen noted, “The results so far achieved its initial goal of: 1) this level of drug is tolerable; 2) calcifediol, the active ingredient in Rayaldee can be activated in patients with absence of kidney function; and 3) SHPT can be treated in ESRD patients with this medication (>30% response rate).”The outcome is especially promising as it opens the door for Rayaldee’s use in end-stage renal disease (ESRD). “We are encouraged by the activation of calcifediol in ESRD patients possibly due to elevated activities of ex-renal enzyme as renal enzyme no longer functions. This could be an important discovery that might change the dogma of conventional understanding. The preliminary interim results of the Phase 2 in ESRD patients bode well, in our opinion, for the future second part of the Phase II study (n=300) given some of the key potential hurdles might have been removed,” Jen explained.Even though the company will need to discuss the Phase 2 data with the FDA and progress through the second part of the study before it can initiate pivotal trials in 2021 or 2022, Jen sees big things in store for OPK.As a result, the analyst left a Buy rating and $6 price target on this penny stock. Should the target be met, a twelve-month gain of 258% could be in the cards. (To watch Jen’s track record, click here)Turning now to the rest of the Street, other analysts have also been impressed with OPK. With 100% Street support, the consensus is unanimous: the stock is a Strong Buy. Additionally, the $4.33 average price target brings the upside potential to 158%. (See OPKO Health stock analysis on TipRanks)VEON Ltd. (VEON)Switching gears now, VEON offers connectivity and digital services to millions of people all over the world. Like the broader market, 2020 has been rough on this company, but with a $1.61 share price, there could be an opportunity for Wall Street observers to capitalize on its recent weakness.This is the stance taken by HSBC analyst Herve Drouet. He acknowledges that the company has faced significant headwinds related to both COVID-19 and recent weakness in many of its operating currencies. “The company issued a new trading update on 31 March 2020. The company expects COVID-19 led disruption to pose headwinds for roaming and equipment revenues. It also expects pressure on margins in Russia and Pakistan, while Ukraine is expected to continue its strong momentum,” he stated.As a result of these challenges, questions have been raised regarding its debt and ability to maintain its dividend payment. While the dividend is a concern for the analyst, he isn’t as alarmed by the debt situation.“However, in terms of its debt situation, we believe that the company should be able to refinance / meet its obligations using current cash and available credit lines. Furthermore, the company has capex flexibility – in case it is pushed to maximize cash flows for the short term. Any steps to rationalize its asset portfolio or improve margins in Russia should aid the stock,” Drouet commented.On top of this, VEON’s valuation is a key component of Drouet’s bullish thesis. “...on an EV/EBITDA basis appears to be trading at 3.3x 2020e EBITDA – below its 1yr forward average trading multiple of (3.6x) over the last five years and close to past trough levels on EV/OpCF basis (See page 5). Current valuations imply that the market is assuming a cost of equity of c17% for VEON (HSBCe:16%) or USD-RUB exchange rate of c88 vs current rate of c76. Any positive news like limited COVID-19 impact, oil price increase, or RUB appreciation should bode well for the stock, in our view,” the analyst noted.It should come as no surprise, then, that Drouet remains optimistic. Having said that, along with a Buy rating, he cut the price target from $3.10 to $1.80. (To watch Drouet’s track record, click here)All in all, VEON’s Moderate Buy consensus rating breaks down into 2 Buys and a single Hold. Based on its $2.43 average price target, the upside potential comes in at 50%. (See VEON analysis on TipRanks)To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.


U.S. Retirement Savers Stayed Calm While Stock Markets Plunged

Thu, 04/16/2020 - 12:00

(Bloomberg) -- Americans saving for retirement weren’t panicking last quarter even as markets crashed and their 401(k) nest eggs deflated.Only 5.6% of people enrolled in a 401(k) plan changed their portfolio allocations in the first three months of 2020, according to a Morningstar Inc. analysis of more than 635,000 participants.Retirement savers’ lack of activity will be good news to experts who worry about individual investors selling at the worst possible time -- by locking in losses after markets have already dropped.“Assuming you’re in a risk-appropriate, well-diversified portfolio the best approach is probably to hang tight,” David Blanchett, head of retirement research at Morningstar Investment Management, wrote in the report. “There is a significant amount of research noting that 401(k) participants, and investors in general, are not very good at building their own portfolios or timing the stock market.”At one point last month, the S&P 500 had plunged 31% year-to-date. Stocks have rebounded strongly since then, surging 24% from that March 23 low.The median 401(k) lost 11.2% of its value during the first quarter, Morningstar data show. Many participants minimized losses by continuing to make retirement plan contributions during the period.The savers most likely to tweak their 401(k) allocations were self-directed investors, with 10.8% making changes. By contrast, just 2.4% of investors in target-date funds touched their portfolios.Other data have also shown that retail investors were not major sellers of stocks as the markets dropped in late February and March.Research by Vanguard Group last month found that more than 9 in 10 investors didn’t trade in response to the market declines. For those Vanguard clients who did trade, 7 in 10 actually bought stocks.Many 401(k) participants may simply have been trying to ignore the volatility for as long as possible. A study last month by Empower Retirement, which administers plans covering more than 9.4 million participants, found only 16% even logged in to check their balances over the 30 days starting Feb. 24.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.


Airlines Plunge After United Warns of ‘Essentially Zero’ Demand

Thu, 04/16/2020 - 11:59

(Bloomberg) -- U.S. airlines sank after United Airlines Holdings Inc. said travel demand was “essentially zero,” with no sign of improvement in the near term.United’s dire tone underscored the depth of the crisis for the nation’s carriers despite billions of dollars in assistance from U.S. taxpayers. With the Covid-19 pandemic and government travel restrictions forcing people to stay home, United predicted it would fly fewer people during all of next month than on a single day in May 2019.The airline will further reduce its flight schedule in May to roughly 10% of what it had planned at the start of 2020, and similar cuts are in store for June, said Chief Executive Officer Oscar Munoz and President Scott Kirby. The U.S. rescue package signed into law last month will help airlines pay employees while obliging the companies not to cut jobs through Sept. 30. But in the longer term, United signaled that payroll cuts may be necessary for the company to survive.“The challenging economic outlook means we have some tough decisions ahead as we plan for our airline, and our overall workforce, to be smaller than it is today, starting as early as October 1,” Munoz and Kirby said in a message to employees late Wednesday. “We expect demand to remain suppressed for the remainder of 2020 and likely into next year.”United fell 9.2% to $28.92 at 11:19 a.m. in New York, the biggest drop on a Standard & Poor’s index of nine U.S. airlines. The industry stock gauge fell 54% this year through Wednesday, compared with a 14% drop for the S&P 500 Index.As part of $25 billion in airline assistance being doled out by the U.S. Treasury, United will collect about $5 billion in grants and a low-interest loan.Carriers are also in line for $25 billion in additional loans as part of the overall economic rescue plan of about $2 trillion. Airlines seeking quick review of their loan applications have been told by Treasury officials to file by April 17.More than 20,000 United employees have accepted voluntary leave and separation programs as the company seeks to reduce labor expenses. The Chicago-based airline, which had a workforce of about 95,000 at the start of the year, said it would renew efforts to interest more workers in the programs.“The challenge that lies ahead for United is bigger than any we have faced in our proud 94-year history,” Munoz and Kirby said. “We are committed to being as direct and as transparent as possible with you about the decisions that lay ahead and what impact they will have on our business and on you.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.


 
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