Stocks were lower to start Wednesday with the Dow slid 37 points, or 0.1%. The S&P 500 fell 0.2%, while the Nasdaq sank 0.5%.
Johnson & Johnson’s one-shot COVID-19 vaccine was found to be safe and effective enough for approval by FDA staff, clearing the way for emergency use authorization by the FDA’s Vaccines and Related Biological Products Advisory Committee as soon as Friday. The FDA staff said it had determined that the clinical trial results and safety data were “consistent with the recommendations set forth in FDA’s guidance Emergency Use Authorization for Vaccines to Prevent COVID-19.” J&J said the effectiveness of its vaccine demonstrated 66% effectiveness overall, with varying levels of protection by region, and prevented 100% of hospitalizations and deaths from the deadly virus. If approved by the advisory panel on Friday, the company said it will initially be able to provide 4 million doses of the vaccine, with the company ramping up production and aiming to have seven manufacturing sites active by mid-year.
House Democrats are planning to pass their $1.9 trillion coronavirus relief bill on Friday ahead of unemployment lifelines expiring next month. “The American people strongly support this bill,” said House Majority Leader Steny Hoyer, D-Md., “and we are moving swiftly to see it enacted into law.” The package includes $1,400 direct stimulus payments to most Americans, a $400 per week jobless benefit supplement, $20 billion for COVID-19 vaccinations, $50 billion for testing, and $350 billion for state, local, and tribal government relief. The plan also includes a federal minimum wage hike to $15 per hour, though that provision may not survive in the final bill. More than 150 chief executives urged Congress to pass the $1.9 trillion stimulus package in a letter out Wednesday morning. “Previous federal relief measures have been essential, but more must be done to put the country on a trajectory for a strong, durable recovery,” the letter—signed by Goldman Sachs’ David Solomon, BlackRock’s Larry Fink, Zillow’s Rich Barton, and Intel’s Pat Gelsinger, among other members of the Business Roundtable—read. “The country’s business community is prepared to work with you to achieve these critical objectives.”
Lowe’s shares are down more than 4% this morning even after the company reported that same-store sales rose 28.1% in the fourth quarter. The home improvement retailer reported adjusted earnings per share of $1.33 on revenue of $20.31 billion, while analysts had expected earnings of $1.21 per share on revenue of $19.48 billion. While the results were strong, CFO David Denton said home improvement sales are likely to decline this year as more people get vaccinated against the coronavirus and spend more time outside their homes. In other earnings news, TJ Maxx-parent TJX Companies delivered worse-than-expected fourth-quarter results. The discount retailer said it earned $326 million, or $0.27 per share, compared to $0.81 per share in the same period last year. TJX management said that the first three weeks of the fiscal first quarter saw overall better comparable sales in stores that were open than were seen in the fourth quarter, despite harsh winter weather across the U.S., though it said that it still expects store closures due to the pandemic to affect its first-quarter results.
GameStop is back in the headlines today after the video game retailer announced CFO Jim Bell will step down next month as the company focuses on shifting into technology-driven sales. The board and management pushed Bell out to make way for a new finance chief who shares their vision of transforming the company from a brick-and-mortar retailer into an e-commerce company. Jim Bell has held the CFO position for less than two years and will receive $15.8 million when he departs. GameStop said it is looking for a permanent replacement “with the capabilities and qualifications to help accelerate GameStop’s transformation.”
And Workhorse Group shares are down 6% today after dropping as much as 60% yesterday. The electric vehicle maker was passed over for a key contract from the U.S. Postal Service many expected it to win. The 10-year contract to manufacture postal delivery vehicles, which will drive the “most dramatic modernization of the USPS fleet in three decades,” instead went to Oshkosh Defense. The contract “would have given [Workhorse] a balance sheet, materials leverage, and major credibility,” said Roth Capital analyst Craig Irwin. “The award would have differentiated them from the pack. Management will now have a much harder time scaling the business.”
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Everquote Inc (NASDAQ: EVER): Everquote shares are up nearly 4% today after the online insurance marketplace company announced results for its fiscal fourth quarter. “Our team executed remarkably well this quarter, closing out a record year at EverQuote delivering year-over-year revenue growth of 32% in the fourth quarter, and 39% for the full year,” said Jayme Mendal, CEO of EverQuote. “We drove greater operating efficiency with VMM growth of 46% and 48% for the fourth quarter and full year, respectively, which supported making significant investments to accelerate our long-term growth. We also achieved record Adjusted EBITDA in 2020. Our team remains focused on EverQuote’s vision to become the largest online source of insurance policies by using data and technology to make insurance simpler, more affordable and personalized, ultimately reducing cost and risk.”