Stocks were lower to start Friday with the Dow falling 10 points, or less than 0.1%. The S&P 500 slid 0.1%, while the Nasdaq opened 0.3% lower.
Virgin Galactic shares are down more than 9% this morning after the space tourism company delayed its next spaceflight test, which was scheduled for this weekend. “We have been progressing through our pre-flight preparations and, during that process, we have decided to allow more time for technical checks. We are working to identify the next flight opportunity,” Virgin Galactic said in a statement. The company had identified a flight window opening Saturday to run through the month, so another test may still be scheduled soon. Earlier this week, UBS cut its rating on the stock to Neutral, writing in a note that “we’re mindful of valuation that appears full,” even as upcoming test flights create an attractive “catalyst chain.”
Disney shares are down around 1% at the time of writing even after it reported strong growth in paid streaming subscribers and its first quarterly profit since early last year. For its fiscal first quarter, the company reported earnings per share of $0.32 on revenue of $16.25 billion, compared to Wall Street expectations for a loss of $0.41 per share on revenue of $15.9 billion. One strong point in its earnings report, Disney said it now has nearly 95 million paid subscribers to its Disney+ streaming service, with Disney CFO Christine McCarthy telling analysts that the company’s executives are “really happy with the conversion numbers that we’ve seen there going from the promotion to become paid subscribers.” CEO Bob Chapek added, “Disney+ has exceeded even our highest expectations.”
As COVID-19 vaccine demand continues to outpace supply, Dr. Anthony Fauci said Thursday that by April it could be “open season” for vaccine eligibility in the U.S. “By the time we get to April, that would be what I call for lack of better wording, open season. Namely, virtually everybody and anybody in any category could start to get vaccinated,” Fauci said on NBC’s Today Show. The Biden administration also said that the U.S. has just signed contracts for 100 million more doses each of the Moderna and Pfizer vaccines, for delivery by the end of July. “We’ve now purchased enough vaccine supply to vaccinate all Americans,” said President Joe Biden, while also warning of the ongoing threat of the virus. “We remain in the teeth of this pandemic.”
Bausch Health shares are up more than 5% after activist investor Carl Icahn disclosed a stake in the company. Icahn has acquired 27.8 million share interest in the pharmaceutical and medical device maker, making him the company’s largest shareholder with 7.83% of ownership. Icahn said Bausch Health’s shares are “undervalued,” adding that he plans to “engage in discussions” with management to find ways to enhance shareholder value. The company responded to Carl Icahn’s interest by saying in a statement that it welcomes “open communication with our shareholders and constructive input toward the shared goal of enhancing shareholder value.”
And Credit Suisse says the chicken sandwich war is just heating up. The firm said in a report that McDonald’s is looking to win with lower prices when it releases its new sandwich on February 24, Yum Brands’ KFC is rolling out its new menu item by the end of the month, while Restaurant Brands International’s Burger King still in the testing stages and figuring out its strategy. Popeyes kicked off the chicken sandwich wars in 2019 with its crispy chicken offering that pitted it directly against Chick-fil-A. The Popeyes sandwich quickly became a hit, driving double-digit same-store sales growth and adding around $400,000 in annual sales for every location. “We expect competition to heat up in 2021 as brands across segments elevate their offerings to take a bit out of the chicken category and enhance competitive positioning,” Credit Suisse analyst Lauren Silberman said in a note.
Stocks We’re Watching
Curis Inc (NASDAQ: CRIS): Curis shares are up nearly 5% over the last week after the biotech announced that the first patient had been dosed in its Phase 1 trial evaluating CA-4948, a novel small molecule IRAK4 kinase inhibitor, in combination with ibrutinib, a BTK inhibitor, in patients with relapsed or refractory (R/R) hematologic malignancies. “In dosing the first patient in this Phase 1 study evaluating CA-4948 and ibrutinib, we are taking a highly anticipated step forward in bringing a potent oral therapeutic regimen to patients with relapsed or refractory hematologic malignancies,” said James Dentzer, President and Chief Executive Officer of Curis. “BTK inhibitors are an approved category of therapies for patients with various lymphatic cancers yet they only target one of the two main pathways activating NF-κB in B-cell malignancies. CA-4948 targets the other main NF-κB-activating pathway by shutting down signaling through the Myddosome. We have shown highly encouraging increased tumor-reducing activity when combining both covalent and non-covalent BTK inhibitors with CA-4948 in preclinical models.”