Johnson & Johnson (NYSE: JNJ) announced on Friday that it is preparing to resume its large clinical trial of the drugmaker's experimental coronavirus vaccine after finding no evident the vaccine has caused the "unexplained illness" in a study volunteer that triggered the pause to the trial earlier this month. The company stated that an independent data safety and monitoring board recommends the company to resume recruitment of the trial. Johnson & Johnson has not offered further details about the nature of the illness in the study's participant. The drugmaker plans to enroll as many as 60,000 volunteers for its Phase III clinical trial in the United States to test its potential coronavirus vaccine.
A Californian court of appeals on Thursday unanimously ruled against the ride-hailing companies Uber Technologies (NYSE: UBER) and Lyft (NASDAQ: LYFT), saying that the companies must reclassify their drivers as employees in the state. The ruling does not take effect until Nov. 3, which a company-sponsored ballot measure will give voters the chance to decide over the future status of gig workers. "Today's ruling means that if the voters don't say Yes on Proposition 22, rideshare drivers will be prevented from working as independent contractors, putting hundred of thousands of Californians out of work and likely shutting down ridesharing throughout much of the state," Uber stated, quoted by Reuters.
According to a court filing on Friday, Alphabet's Google (NASDAQ: GOOGL) must respond to the U.S. Justice Department's antitrust lawsuit by December 19. On Tuesday, the Justice Department sued the $1 trillion company and accused it of illegally maintaining a monopoly in search by cutting off rivals from distribution channels. The states involved in the lawsuit are Arkansas, Florida, Georgia, Indiana, Kentucky, Louisiana, Mississippi, Missouri, Montana, South Carolina and Texas. Google has called the lawsuit "deeply flawed."
American Express Company (NYSE: AXP) reported third quarter earnings before market open, producing mixed results. The company's revenue of $8.75 billion was a year-to-year decrease of 20.4%, but beat Wall Street consensus expectations by $40 million. Conversely, American's GAAP earnings per share of $1.30 estimates missed by $0.05. The company's provision for losses came under consensus at $665 million for the quarter, down from $1.56 billion in the second quarter and $879 million in 2019. "While credit remains strong, with delinquencies and net write-offs at the lowest levels we have seen in a few years, we remain cautious about the direction of the pandemic and its impacts on the economy, which is reflected in our reserve levels," CEO Stephen Squeri stated in a press release. The company did not report further guidance at this time.
Goldman Sachs analyst Noah Popanak initiated Virgin Galactic (NYSE: SPCE) with a rating of Neutral, taking an opposite stance from the bullish tone Wall Street has for the stock. "Long-term upside potential could be substantial, if SPCE can capture the space travel and supersonic right opportunity. But the time to realization of the opportunity is very long, customer adoption and recurrence uncertain, and potential for competition not insignificant," Poponak wrote in a note to clients. The biggest issue Popanak has with the stock is the company's long technological development timeline. “Spaceflight technology is not an easy feat, many timeline delays have already occurred, and more could. SPCE will need to ramp up flight capacity even if demand to fly is high. We do not see cash flow breakeven before the middle of the decade," Popanak added. On the positive side, the firm sees that long-term upside for the space company could potentially be substantial due to its large market share and head start.
Tesla (NASDAQ: TSLA) is recalling nearly 50,000 of its Model S and Model X electric vehicles inChina due to potentially faulty and unsafe front and rear-end suspensions, according to an announcement issued by the Chinese State Administration for Market Regulation. According to China's auto industry news site, Gasgoo, the recall affects over 29,000 imports of both models produced between Sept. 17, 2013 to Aug. 16, 2017, and over 19,000 imported Model S vehicles produced between Sept.17, 2013 and Oct. 15, 2018. According to CNBC, the vehicles were manufactured at Tesla's Fremont, California assembly plant. The National Highway Traffic Safety Administration, the U.S. vehicle safety authority, did not issue a similar recall at this time.
Bloomin' Brands (NASDAQ: BLMN) reported third quarter earnings before market open, topping Wall Street consensus expectations. The company's revenue of $771.3 million was a year-to-year decrease of 20.2% , but beat estimates by $18.43 million. Bloomin's Non-GAAP earnings per share of -$0.12 and GAAP earnings per share of -$0.20 also beat by $0.20 and $0.14, respectively. Comparable sales were lower across all brands: Carrabba's Italian Grill down 9%, Bonefish Grill down 22.5%, Fleming's Prime Steakhouse & Wine Bar down 20.3% and Outback Steakhouse down 54.8%. The company ended the quarter with a cash position of $160 million. "Across the U.S. portfolio, we experienced consistent weekly sales momentum throughout the third quarter as we adapted to this evolving environment. In-restaurant sales continue to improve and our off-premises business remains robust as we are retaining approximately 50% of the incremental volume achieved while our dining rooms were closed. Off-premises remains a priority and we will leverage our strong capabilities to capitalize on this important and growing channel," CEO David Deno stated in a press release. Bloomin' did not provide further guidance at this time.
BJ's Restaurants (NASDAQ: BJRI) reported third quarter earnings after market close on Thursday, topping Wall Street consensus expectations. The company's revenue of $198.89 million was a year-to-year decrease of 28.6%, but beat estimates by $18.78 million. BJ's Non-GAAP earnings pre share of -$0.44 and GAAP earnings per share of -$0.30 also beat by $0.31 and $0.43, respectively. The company reported that comparable sales during the quarter fell 30.25. "Early in Q3 we were operating with less than 70% of our restaurant dining rooms open and subject to indoor seating capacity limitations. In response, our teams quickly mobilized to build approximately 100 temporary outdoor patios to provide guests with a safe, comfortable and enjoyable dining experience. These new patios, combined with our continued take-out and delivery focus and certain dining rooms re-opening, helped drive weekly sequential sales increases throughout the quarter," the company updated in a press release. The company did not issue further guidance at this time.
The Boston Beer Company (NYSE: SAM) reported third quarter earnings after market close on Thursday, producing mixed results. The company's revenue of $492.79 million was a year-to-year increase of 30.2%, but missed Wall Street consensus expectations by $28.14 million. However, Boston's Non-GAAP earnings per share of $6.10 and GAAP earnings per share of $6.51 both beat estimates by $1.38 and $1.74, respectively. The company issued strong guidance: for its full year, the company expects depletions and shipments to increase between 37-42%. Boston expects full-year adjusted earnings per share of $14-15, and anticipates full-year gross margin of $46-47%. Boston Beer's estimated capital spending is forecasted to be between $160-190 million. "We have planned some major innovations to be introduced in 2021 for all our brands. These include Truly Iced Tea Hard Seltzer, Samuel Adams' Just the Haze, our first non-alcoholic beer, Dogfish Head Scratch-Made Canned Cocktails and Angry Orchard Hard Fruit Cider. We are confident in our ability to continue to innovate and build strong brands to help support our mission of long-term profitable growth," CEO Jim Koch stated in a press release.
Limelight Networks (NASDAQ: LLNW) reported third quarter earnings after market close on Thursday, producing mixed results. The company's revenue of $59.24 million was a year-to-year increase of 15.4% and beat Wall Street consensus expectations by $300,000. Limelight's Non-GAAP earnings per share of -$0.01 and GAAP earnings per share of -$0.03 missed estimates by $0.03 and $0.01, respectively. “Q3 was a very strong quarter for us on a number of fronts as we experienced our second highest quarter of revenue ever and made material progress across our strategic imperatives. Most notable in the quarter was the expansion of our edge capabilities with the launch of Edge Functions and gains in our automated traffic engineering efforts to optimize network performance and customer experience. As we have consistently done all year, we continue to make investments in the business to support our strategy of doubling down on edge innovation with focus on video, media and gaming customers. We are on track to deliver record revenue and revenue growth for 2020, along with meaningful increases across multiple financial and operational metrics. We are well-positioned to continue delivering value for our customers and growth for our shareholders.” CEO Robert Lento stated in a press release. For its full year 2020 outlook, Limelight sees revenue between $230-240 million; earnings per share of -$0.13 to -$0.03; adjusted earnings per share of -$0.02-$0.08; adjusted EBITDA of $28-35 million; and Capex of $25-30 million.
Facebook's (NASDAQ: FB) Instagram is expanding its test feature that allows creators with smaller influence on the social media platform to earn money through tips on live streams. The platform's "Badges" feature lets users tip influences during a stream on Instagram Live, similar to features on Amazon's (NASDAQ: AMZN) Twitch or ByteDance's TikTok. Instagram is rolling out the new feature to more than 50,000 creators as part of its beta testing, with user payments going directly to content creators. However, Apple (NSDAQ: AAPL) and Google (NASDAQ: GOOGL) will still take 30% of the transactions due to the app being hosted on iOS or Android.
Piper Sandler analyst James Fish has downgrades Fastly (NYSE: FSLY) to a rating of Underweight from Neutral, citing that "the market is still not factoring enough risk." Last week, Fastly's shares plunged after the company lowered is third quarter revenue guidance due to lower-than-expected demand from its largest customer, ByteDance's TikTok. Fish notes that TikTok is building its own content delivery network and estimates that Fastly's organic growth is "likely to slow into the mid-20s next year," in a note to clients. The firm has also cut Fastly's price target to $665 from $84.
Bank of America analyst Vivek Arya downgraded Intel (NASDAQ: INTC) from a rating of Neutral to Underperform following the chipmaker's third quarter earnings miss. The firm also lowered that stock's price objective from $60 to $45. Arya notes that Thursday's earnings results showed three structural issues: "1) No plan/update to fix manufacturing challenges at next-gen 7nm, with continued low yields at current-gen 10nm process; 2) Mix pressure as demand moves to more competitive cloud/consumer markets away from INTC’s profitable enterprise PC/server markets (data center missed Q3 by 4%, down 8% YoY, plus 10nm Ice Lake server pushed out to Q1); 3) increasing competition from faster, nimbler fabless competitors such as Nvidia (NASDAQ: NVDA), AMD (NYSE: AMD), ARM-based suppliers and others that are able to take advantage of the foundry ecosystem." The firm reiterated its Buy ratings on Nvidia and AMD, citing the expected continuing CPU and GPU shares gains.
Redfin Chief Executive Glenn Kelman told CNBC on Thursday that he anticipates that the pandemic-driven housing market boom will extend into 2021. According to the National Association of Realtors, existing home sales have increased 9.4% in September, with the median purchase price rising by nearly 15% year-over-year. "There's no way it can last forever. This level of demand is absolutely insane. I would expect it to last into 2021, at least," Kelman told CNBC's "Power Lunch." "There are so many people now who have decided they're not going to be able to buy a home by year-end, who expect to do so going into 2021...I do think we're going to see this for some time." Low interest rates are also motivating homebuyers, Kelman added, noted that interest rates will not always remain low. "Part of what is fueling this boom is that the economy has just split into two and rich people are able to access capital almost for free, so, of course, they're going to use that money to buy homes."
Morgan Stanley analyst Adam Jones has doubled the firm's long-term valuation estimate for Elon Musk's SpaceX, now expecting the company to be worth at least $100 billion due to its market position. "SpaceX continues to solidify its place as 'mission control' for the emerging space economy. Important milestones with Starlink, Starship and government contracts dovetail to support an increase in our base case valuation," Jones wrote in a note to clients. Jonas noted that "quite a lot has changed" since the firm had last set a valuation for the company back in July, leading to the new valuation expectations being twice Morgan Stanley's previous estimate. "The pieces are coming together for SpaceX to create an economic and technological flywheel," Jonas added.