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Shares of Boeing (BA) and Spirit AeroSystems (SPR) plunge after mid-air blowout. (00:29) Merck (MRK) in talks to acquire Harpoon Therapeutics (HARP) for around $700M – Bloomberg. (01:44) Audacy (OTCPK:AUDA) files for Chapter 11 bankruptcy as ad sales crash. (02:26)
This is an abridged transcript of the podcast.
Boeing is down 8% premarket after finding itself back in the spotlight dealing with a safety issue related to one of its plane models.
A so-called door plug on Alaska Airlines (NYSE:ALK) Flight 1282 blew out on Friday evening, causing the cabin to rapidly depressurize.
This happened on a Boeing (NYSE:BA) 737 Max 9 only 6 minutes after it left the Portland International Airport. The plane landed back in Portland and no serious injuries were reported. The jetliner was cruising at an altitude of 16,000 feet, and no one was sitting in the two seats next to the affected area.
The FAA ordered that certain Boeing (NYSE:BA) 737 MAX 9 planes be grounded after the incident.
An investigation is underway to examine the door plug. Aerospace supplier Spirit AeroSystems (NYSE:SPR), which manufactures and installs the door plugs in question, has tumbled more than Boeing in early trading, 16.5% to $26.50/share.
The agency noted that ~171 planes will require inspection before being allowed to return to service.
The part of the plane that blew off has been found in someone’s backyard.
Merck (NYSE:MRK) is reportedly in advanced talks to buy immuno-oncology company Harpoon Therapeutics (NASDAQ:HARP) for around $700M.
Citing people familiar with the matter, Bloomberg News reported on Sunday that Merck (MRK) is discussing paying roughly $23/share for the South San Francisco-based cancer drugmaker. The offer represents a premium of 118% to Harpoon’s last closing price of $10.55.
A deal could be announced within days assuming talks don’t fall apart, the people said.
Harpoon (HARP) is developing a novel class of T cell engagers that unleash the power of the body’s immune system to fight cancer and other diseases.
Audacy has filed for Chapter 11 bankruptcy protection in Texas, which involves a restructuring plan that would slash its debt from about $1.9 billion to around $350 million.
Audacy (OTCPK:AUDA) CEO David Field said “… the perfect storm of sustained macroeconomic challenges over the past four years facing the traditional advertising market has led to a sharp reduction of several billion dollars in cumulative radio ad spending.”
The company’s creditors will receive equity in the reorganized firm. Audacy (OTCPK:AUDA) does not expect the bankruptcy filing to affect its day-to-day operations.
Certain existing lenders have committed to provide $57 million in debtor-in-possession financing.
The DIP financing along with the firm’s cash from operations and available reserves will enable Audacy (OTCPK:AUDA) to fulfill commitments to staff, advertisers, partners and vendors.
Audacy’s (OTCPK:AUDA) stock will continue to trade over-the-counter during the reorganization proceedings. The shares are expected to be canceled and receive no distribution as part of the restructuring.
The shares, which were delisted from NYSE in November, have dropped 97% over the last year.
On our catalyst watch for the day,
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The ICR Conference is one of the biggest retail sector conferences and typically features a flurry of guidance updates for the key holiday quarter. Some of the companies scheduled to participate include Wolverine World Wide (WWW), Walmart (WMT), Urban Outfitters (URBN), Duckhorn Portfolio (NAPA), and Lululemon (LULU) among others.
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The J.P. Morgan Healthcare Conference is typically one of the bigger healthcare conferences of the year. In the past, M&A announcements, drug data results, and financial guidance updates have poured in around the conference. Some of the notable companies to watch include Johnson & Johnson (JNJ), Moderna (MRNA) and Incyte (INCY) among others.
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Nvidia (NVDA), LG Electronics, Volkswagen (OTCPK:VLKAF), Panasonic (OTCPK:PCRFY), Hyundai (OTC:HYTLF), Samsung (OTCPK:SSNLF), and Sony Group (SONY) are all scheduled to hold media events at CES.
On our earnings watch for the day, Jefferies Financial Group (NYSE:JEF) is scheduled to announce Q3 earnings results today after market close. The consensus EPS Estimate is $0.24 (+9.1% Y/Y) and the consensus Revenue Estimate is $1.15B (-2.5% Y/Y). Over the last 2 years, JEF has beaten EPS estimates 63% of the time and has beaten revenue estimates 75% of the time.
Other articles to look out for on Seeking Alpha:
Earnings week ahead: Citigroup, JPMorgan, UnitedHealth, Delta Airlines and more
Winter weather could mean hot returns for these stocks
Some electric vehicles are underperforming EPA range estimates – is yours one of them?
Major market averages were able to eke out gains on Friday and close higher by a slight margin in a choppy session that started with a hawkish jobs report.
The Nasdaq (COMP.IND) ticked up by 0.09%, the S&P 500 (SP500) rose 0.18%, and the Dow (DJI) finished in the green by 0.07%.
Eight of the 11 S&P sectors closed out the day higher with Financials leading the way up. Consumer Staples and Real Estate were the weakest performing sectors.
Stocks ended the first trading week of 2024 in negative territory as the Nasdaq fell 3.4% and was the weakest performer. The S&P 500 lost 1.5% on the week and the Dow lost 0.6%.
Now let’s take a look at the markets as of 6 am. Ahead of the opening bell today, Dow, S&P and Nasdaq futures are in the red. The Dow is down 0.5%, the S & P 500 is down 0.2% and the Nasdaq is down 0.2%. Crude oil is down 2.8% at more than $71 per barrel. Bitcoin is up 0.2% and above $44,000.
In the world markets, the FTSE 100 is down 0.3% and the DAX is up a small fraction.
The biggest movers for the day premarket: Heron Therapeutics (NASDAQ:HRTX) is up 17% following a partnership with CrossLink Life Sciences.
On today’s economic calendar:
Editor’s Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Please be aware of the risks associated with these stocks.
