More than 600 flights to and from Atlanta have been canceled; Delta Air Lines (NYSE:DAL), which has its headquarters and largest hub in Atlanta, has canceled more than 450 mainline and regional flights.
Southwest (NYSE:LUV), American (NASDAQ:AAL) and United (NYSE:UAL) have canceled operations in and out of Atlanta for the rest of the day.
The Washington Post reports that a team at the Drug Enforcement Administration (DEA) was ready to move on McKesson (NYSE:MCK) since they could prove that the drug wholesaler failed to report suspicious orders of opioids to certain drugstores despite repeated warnings. Some of the accounts were corrupt pharmacies who supplied illegal distribution rings.
The Denver, CO-based team, involving nine field divisions and 12 U.S. attorneys across 11 states, wanted to revoke controlled substance distribution licenses at some of McKesson's 30 warehouses and fine the company than $1B.
Instead, top lawyers at the DEA and Department of Justice struck a deal with the company under which it will retain all of its DEA registrations, temporarily suspend controlled substance shipments at four distribution centers and pay a $150M fine, its second related to opioid shipments.
In 2008, it paid $13.25M after failing to report hundreds of suspicious hydrocodone orders from internet pharmacies even after a DEA warning three years prior that it was shipping excessive amounts of Vicodin.
In 2012, the DEA noticed that McKesson was shipping a large amount of opioids to a pharmacy in a small town in Colorado that was selling as many as 2,000 pills a day, most coming from the company's Aurora facility. This prompted the current investigation.
MetLife (NYSE:MET) on Friday said it's trying to locate and pay a small portion (5% or less) of 600K retirees who are owed money, but have relocated or otherwise can't be reached. Average benefits are thought to be less than $150 per monthly.
The process of finding and paying is expected to result in a strengthening of reserves which could be "material" to results, says the insurer.
Checking around with analysts, the WSJ's Leslie Scism says some payments could be 10 or more years overdue. Evercore's Thomas Gallagher figures the Q4 charge could be in the $200M-$400M pretax range, but Barclays' Jay Gelb says it could go as high as $1B.
The news is likely to draw at least a glance from state regulators who will remember a few years back finding billions of unpaid life-insurance benefits across the industry.
After a months-long lobbying effort, a group of large U.S. insurers won inclusion in the coming tax bill of tougher tax treatment for those who move headquarters to low or tax-free jurisdictions.
The lobbying group - the Coalition for American Insurance - included Berkshire Hathaway (BRK.A, BRK.B), Hartford Financial (NYSE:HIG), and Travelers (NYSE:TRV). Among those on whom their effort was focused was House Speaker Paul Ryan. After an October deal combining a U.S. insurer with one in Bermuda, his office put out a press release: “Bermuda. Great beaches. Great weather. And, as it turns out, a great place to move your business to avoid the U.S. corporate tax code.”
The Association of Bermuda Insurers & Reinsurers disagrees, and says the new "punitive" taxes threaten reinsurance business in which offshore players take on a chunk of the catastrophe risk of P&C insurers. "Don’t be fooled by claims of the U.S. insurers who’re trying to hide behind a false patriotism,” said Chubb (NYSE:CB) CEO Evan Greenberg recently. His company, of course, not long ago sold out to Bermuda-based ACE.
Depending on the outcome of a trial that starts Monday, General Motors (NYSE:GM) faces a potential payout of $1B in stock to address claims related to its ignition switch crisis.
The case will determine whether the automaker can stop a deal reached in August between ignition switch plaintiffs and a trust representing creditors of so-called Old GM, the assets left behind in 2009 as part of a $50B government rescue.
Biotech: Gilead Sciences (NASDAQ:GILD) was a strategic investor in a $59.6M Series C round in Hookipa Biotech. The clinical stage biotech has a cytomegalovirus vaccine in phase 2 and cancer candidates derived from two arenavirus-based vector platforms. Hookipa has raised $100.2M to date, according to Crunchbase.
The round was led by an unnamed blue chip public investment fund. New investors include Hillhouse Capital and HBM Partners that join current investors Boehringer Ingelheim Venture Fund, and Takeda Ventures (OTCPK:TKPHF).
New media: Baidu (NASDAQ:BIDU) Video participated in a $45M Series A round in Chinese new media company 36Kr Media, which was spun off from entrepreneur and SME service provider 36Kr. The Media arm has now raised $45.4M.
The round was led by Chinese venture capital firm Gobi Partners and private equity fund China Prosperity Capital. Other participants: Focus Media Information Technology and Hangzhou Finance Investment Group.
VR: Location-based VR startup Dreamscape Immersive raised $30M in Series B funding led by AMC Entertainment (NYSE:AMC). AMC contributed $20M to the round, which was announced in September. The additional $10M announced this week came from new investors Nickelodeon (NYSE:VIA), VRSense Solutions, and returning investors 21st Century Fox (NASDAQ:FOXA) and Warner Bros (NYSE:TWX). The round brings Dreamscape up to $37M in investments.
Dreamscape creates untethered VR experiences with body mapping that allows users to have a more immersive experience in cinematic worlds. Dreamscape will open its flagship location next year in Los Angeles and has partnered with AMC to operate up to six VR centers within AMC theaters.
Sales training: MindTickle, creator of a sales team training platform, raised $27M in Series B funding led by Canaan Partners with participation from existing investors Accel Partners, Qualcomm (NASDAQ:QCOM) Ventures, and New Enterprise Associates. MindTickle has raised $41.3M to date.
MindTickle’s platform allows for data-driven onboardings, skills development, and coaching. Current customers include Symantec, Phillips, Cloudera, and Nutanix
Cloud security: ShieldX Networks closed a $25M Series B round of funding that brings total investments up to $34M. The round included new investors Symantec (NASDAQ:SYMC) Ventures and FireEye founder Ashar Aziz. Participating existing investors: FireEye (NASDAQ:FEYE), Bain Capital Ventures, Aspect Ventures.
Energy: Ess, a provider of all-iron flow batteries, raised $13M in Series B funding that lifted total fundraising to $17M. The round was led by BASF (OTCQX:BASFY) and joined by new investors Cycle Capital Management, InfraPartners Management, and Presidio Partners Investment Management.
Ess said the investment would enable a 900 MWh per year production capacity.
SaaS: Active strategy management SaaS company Workboard raised $9.3M in Series A funding from Floodgate and Microsoft (NASDAQ:MSFT) Ventures.
Current Workboard customers include IBM, Samsung, and Catalina. Workboard’s total fundraising now totals $13.6M.
Reservations: Reservation and guest management software company SevenRooms raised $8M in new VC funding. The funding was led by Comcast (NASDAQ:CMCSA) Ventures. As part of the investment, Comcast Ventures Managing Director Dinesh Moorjani will join the SevenRooms’ board.
SevenRooms has customers in over 100 cities and the new investment brings total funding up to $16.4M.
Seed funding: 3TEN8, which predicts wireless outages using AI, raised $2M in seed funding from leader Social Capital with Citrix (NASDAQ:CTXS), 500 Startups, The Alchemist, and Cloudera CTO Amr Awadallah also participating.
Conversational AI company Kami raised $1.7M in seed funding from SoftBank (OTCPK:SFTBF, OTCPK:SFTBY) subsidiary ARM Innovation Ecosystem Accelerator Limited with X Technology Fund and Tin Fu Fund. ARM Electronic Technology’s strategic business development director, Carl Chen, will join Kami as a strategic advisor.
Things may be looking up for oil investors but natural gas investors could face another difficult year in 2018, Morgan Stanley says in reiterating its long-term price projection for natural gas of $2.75.
Increasing productivity and efficiency and the rise of renewable energy will continue to pressure gas prices in the long-term, Stanley says.
But while the firm remains bearish over the medium- to long-term, it thinks winter 2017-18 prices have overcorrected modestly to the downside.
Among nat gas E&P companies, Stanley says Cabot Oil & Gas (NYSE:COG) is its top stock pick while Gulfport Energy (NASDAQ:GPOR) and Southwestern Energy (NYSE:SWN) are its least preferred names.
The firm rates Antero Resources (NYSE:AR), Range Resources (NYSE:RRC) and EQT Corp. (NYSE:EQT) at Equal Weight, while GPOR and SWN are Underweight.
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Key events are scheduled for the companies listed below next week.
D.C. drama: The countdown clock is ticking on Capitol Hill with President Trump eager to deliver a major tax reform package before the Christmas break. A compromise between the Senate and House brings the corporate tax rate to 21% from its current level of 35%. While it's still early in the process, analysts are already buzzing over signals from heavy hitters such as Coca-Cola (NYSE:KO), Boeing (NYSE:BA) and Delta Air Lines (NYSE:DAL) on anticipated EPS benefits and boosted buyback plans from tax reform savings. Expect more talk this week on tax reform plays.
Media M&A shakeup: What's the next domino to fall after Disney (NYSE:DIS) struck a deal to buy film/TV assets from Twenty-First Century Fox (FOX, FOX) for a cool $52.4B? "We believe remaining film/TV studio assets will become increasingly valuable/scarce," predicts BTIG analyst Rich Greenfield on the development. Studios Lions Gate (LGF.A, LGF.B) and privately-held MGM are expected by some to see bids. Other media stocks on the consolidation radar are CBS (NYSE:CBS), Discovery Communications (NASDAQ:DISCA), AMC Networks (NASDAQ:AMCX), Comcast (NASDAQ:CMCSA), Verizon (NYSE:VZ) and Viacom (VIAB, VIA). Though there's also the AT&T (NYSE:T)-Time Warner (NYSE:TWX) vs. DOJ court battle to consider, the biggest media question mark of all may surround Netflix (NASDAQ:NFLX), which faces a Disney-controlled Hulu and the rollback of net neutrality rules.
Expected IPO filings: Adial Pharmaceuticals (Pending:ADIL), Cue Biopharma (CUE) and Advantage Insurance (Pending:AVI) on Dec. 18; iClick Interactive Asia (Pending:ICLK) on Dec. 21; Longfin (NASDAQ:LFIN) on Dec. 22.
IPO/secondary share lockup period expirations: Norwegian Cruise Line Holdings (NASDAQ:NCLH), Bridgepoint Education (NYSE:BPI), (NYSE:KMG), Aldeyra Therapeutic (NASDAQ:ALDX) and Earthstone Energy (NASDAQ:ESTE) on Dec 18.; SG Blocks (NASDAQ:SGBX), Safety Income and Growth (NYSE:SAFE), Altice USA (NYSE:ATUS), Daseke (NASDAQ:DSKE) and Nabriva Therapeutics (NASDAQ:NBRV) on Dec. 19; Performance Food Group (NYSE:PFGC) on Dec. 21; Chatham Lodging Trust (NYSE:CLDT) on Dec. 22.
Notable earnings reports: Heico (NYSE:HEI) on Dec. 18; Carnival (NYSE:CCL), Darden Restaurants (NYSE:DRI), FedEx (NYSE:FDX), Micron (NASDAQ:MU), Red Hat (NYSE:RHT) and Navistar (NYSE:NAV) on Dec. 19; General Mills (NYSE:GIS), BlackBerry (NASDAQ:BB), and Winnebago (NYSE:WGO) on Dec. 20; Nike (NYSE:NKE), Accenture (NYSE:ACN), Rite Aid (NYSE:RAD), ConAgra (NYSE:CAG) and Finish Line (NASDAQ:FINL) on Dec. 21.
Extraordinary shareholder meetings for M&A votes: Arc Logisitcs (NYSE:ARCX) on Dec. 18; Omega Protein (NYSE:OME) on Dec. 19, Ruby Tuesday (NYSE:RT) on Dec. 20; NewStar Financial (NASDAQ:NEWS) on Dec. 21.
Annual meetings: Scientific Games (NASDAQ:SGMS)-NYX Gaming (OTC:NXXYF) and AutoZone on Dec. 20; JAKKS Pacific (NASDAQ:JAKK) on Dec. 22.
Analyst/investor meetings: LogMein (NASDAQ:LOGM) and AGCO Corporatoon (NYSE:AGCO) on Dec 19.; Digital Power (NYSEMKT:DPW) on Dec. 20.
Guidance call: Colfax Corporation (NYSE:CFX) on Dec 18.
Barron's mentions: Alaska Air Group (NYSE:ALK) and Simon Property Group (NYSE:SPG) are singled out as top picks with upside. Income investors are advised to consider Merck (NYSE:MRK), PepsiCo (NYSE:PEP), Daimler (OTCPK:DDAIF) and Novartis (NYSE:NVS). The impact of environmental, social and governance factors at Exxon Mobile (NYSE:XOM) is seen as putting the company at the crossroads.
Box office watch: Another big week is ahead for AMC Entertainment (NYSE:AMC), Cinemark Holdings (NYSE:CNK), Regal Entertainment (NYSE:RGC) and IMAX (NYSE:IMAX) as Star Wars: The Last Jedi (Disney) totals are digested. Ferdinand (Fox) and Coco (Disney) also open this weekend, while Downstairs (Paramount), Pitch Perfect 3 (Universal) and Father Figures (Warner Bros) debut next Friday. Will enough MoviePass (NASDAQ:HMNY) subscriptions make their way into holiday stockings to provide a tailwind for the exhibitor sector in 2018?
Alaska Communications (NASDAQ:ALSK) finished the day up 3.2% after today's disclosure by TAR Holdings and its sole member, Karen Singer, that the firm has a 5% stake and had approached management to urge a sale of the business or some assets.
"TAR Holdings is also considering whether to seek representation on the Issuer’s Board of Directors," the firm's 13D filing continues.
"Alaska Communications has engaged in various discussions with representatives of Ms. Singer and expects to continue a constructive dialogue," the company says, adding it regularly reviews strategic priorities and opportunities and that it's committed to enhancing value for all shareholders.
Congressional Republicans unveil the final details of the House-Senate agreement on tax legislation, with the House scheduled to vote next Tuesday and the Senate expected to follow sometime later in the week.
The plan maintains seven individual income tax brackets but at slightly different rates: 10%, 12%, 22%, 24%, 32%, 35% and 37%, with the top rate trimmed from the current 39.6%.
The final bill limits deductions for state and local taxes on sales, income or property to $10K.
The mortgage interest deduction is lowered to $750K in mortgage debt, down from $1M currently.
The corporate tax rate is cut to 21% from 35%, effective next year; the corporate alternative minimum tax is eliminated; cash currently held overseas will be taxed at a 15.5% one-time “deemed” repatriation rate.
Business owners get a 20% deduction for the first $315K in pass-through income.
The plan ends Obamacare's provision that requires most Americans to buy health insurance or pay a penalty, beginning in 2019.
Subsidies remain intact for private activity bonds that help finance infrastructure projects such as airports and toll roads.
Tax credits for electric vehicles remain unchanged.
In an 8-K filing, Vonage Holdings (NYSE:VG) notes it's planning to include a proposal to end its classified board structure in proxy statements for its 2018 annual meeting.
The company says it will recommend "stockholders approve an amendment to its Restated Certificate of Incorporation to eliminate the Company's classified board of directors structure."
It also accepted the resignation of director Carl Sparks, who's been on the board since 2011, effective after the upcoming February board meeting. He's not leaving because of a disagreement with the company.
The forecast includes expectations for reduced earnings of ~$27M, or $0.07/share, related to the company's two flat roll division planned outages, which resulted in higher costs and lower value-add shipments.
Comparatively, STLD's Q3 adjusted EPS was $0.66 and its year-ago adjusted EPS was $0.43.
Despite the guidance, STLD CEO Mark Millett says "we remain confident that macroeconomic and market conditions are in place to benefit domestic steel consumption in 2018... Domestic steel inventory levels have moderated as the overhang from 'pre-232' imports has dissipated."
The U.K.'s nuclear regulator has approved Hitachi-GE's new nuclear reactor design, clearing the way for Hitachi's (OTCPK:HTHIY) Horizon nuclear power unit to build a nuclear project in Britain.
The regulators said the new reactor design meets regulatory expectations on safety, security and environmental protection.
Hitachi's Horizon plans to construct at least 5.4 GW of new nuclear capacity at two sites in Britain, at Wylfa Newydd in Wales and Oldbury-on-Severn in England, with enough electricity to power ~10M homes.
Hitachi-GE, owned 60% by Hitachi and 40% by GE, is the Japan-based sibling of North Carolina-based GE-Hitachi, which is owned 60% by GE and 40% by Hitachi.
"Because the election results were so close, and because a large number of shareholders voted for Nelson Peltz to be a Director, the Board has engaged in numerous discussions with Mr. Peltz regarding a Board seat," the company says in a shareholder letter.
Despite the election and proxy fight, the two agree on a number of issues, it says: "For example, we agree that we are NOT predisposed to taking on excessive leverage, or substantially reducing R&D spending, or advocating for a break-up of the Company, or moving the Company out of Cincinnati."
Shares are up 0.6% after hours; they rose 1% during the regular session today.
The appointments of Peltz and Jimenez are effective March 1.
AT&T (NYSE:T) CEO Randall Stephenson is exiting the board at Boeing (NYSE:BA), anticipating an "extremely busy" year ahead.
According to a just-filed 8-K, Boeing says Stephenson resigned from its board "in order to devote his time and attention to matters at AT&T."
"Mr. Stephenson informed the Company that the coming year will be an extremely busy one for him at AT&T, and that he thought it best to step down from the Board as a result," the filing says. Stephenson is headed for a high-profile trial with the Justice Dept. over his company's $85B bid for Time Warner (NYSE:TWX).
Stephenson isn't leaving Boeing's board because of any disagreement with the company, the filing points out for the record.
Payable Jan. 18; for shareholders of record Dec. 28; ex-div Dec. 27.
In addition to the regular quarterly dividend, the Fund declared a short-term capital gain distribution of $0.1367/share and a long-term capital gain distribution of $0.1045/share payable along with regular dividend.
Bitcoin futures trading got off to a slow start after opening for acton at the CBOE on Sunday evening. Coming this Sunday is the start of futures trading at the CME - a far busier futures platform than the CBOE.
But what of the retail brokerages? Thus far, only Interactive Brokers (NASDAQ:IBKR) is offering access to futures trading, and with a very high margin (50%). They're about to be joined by TD Ameritrade (NASDAQ:AMTD), which just announced its intention to allow clients to trade Bitcoin futures, starting Monday.
AMTD was higher by 2.15% in the regular session, and up another 2.6% after hours.
Stocks surged to fresh record highs, double their opening gains following reports that Senators Rubio and Corker would vote in favor of the Republican tax reform bill, likely ensuring its passage.
The Nasdaq (+1.2%), S&P 500 (+0.9%) and Dow (+0.6%) each finished at new all-time highs, with the S&P and Dow booking gains for four straight weeks; the Russell 2000 (+1.6%) outperformed but is still ~1% shy of its record high.
Today's rally was broad, as 10 of 11 S&P sectors finished in higher, led by the tech (+1.2%), health care (+1.2%) and financial (+1%) sectors, which comprise more than half of the broader market in total; the energy sector struggled, closing a tick below its unchanged mark, as U.S. crude's 0.5% gain to $57.30/bbl was not quite enough to flip oil's slight loss for the week.
U.S. Treasury prices came in mixed, with the two-year yield rising 4 bps to 1.84%, the benchmark 10-year yield adding a basis point to 2.36%, and the 30-year yield shedding 2 bps to 2.69%.
It's not entirely shocking news, but a court filing today shows that AT&T (NYSE:T) and the Justice Dept. have engaged in settlement talks over the telecom's $85B bid for Time Warner (NYSE:TWX) that ended up at loggerheads.
“All parties have engaged in good-faith settlement negotiations, but despite their efforts, have not been able to settle the matter,” the two sides say in the filing, which set out an agreed schedule leading up to the high-profile March trial that will decide the issue.
That schedule includes final fact witness lists exchanged by Feb. 2, and all pretrial motions filed by March 12.
CSX Corp. (NYSE:CSX) fell 7.6% in today's trade - the biggest losers on the S&P 500 - on worries that CEO Hunter Harrison may not return to the company after being placed on medical leave, while some investors and governance experts called on the company to disclose more about Harrison’s health condition.
Citi analyst Christian Wetherbee recommends using today's CSX selloff as a buying opportunity saying most of what needed to be done to turn around the railroad already has been done, and CSX was in better shape than Canadian Pacific when Harrison took over in 2012; he keeps a Buy rating on the stock with a $58 price target.
But Loop Capital's Rick Paterson thinks the appointment of Jim Foote as interim CEO is an "ominous sign" and implies Harrison's return is "less than likely," adding that he sees CSX's future as "very cloudy" if Harrison does not return since the CEO likely has not had enough time to successfully change the company's network and culture; he rates the stock as a Hold with a $57 price target.
Pet med developer Aratana Therapeutics (NASDAQ:PETX) announces that a study evaluating allogeneic stem cell therapy AT-016 for the treatment of osteoarthritis in dogs failed to meet the criteria for efficacy.
The company says it and its collaboration partner (Eli Lilly's Elanco Animal Health) will decide on whether to continue development after the latter reviews the data.
Shares are off 10% after hours on increased volume.
Delta Air Lines' deal to buy 100 jets from Airbus also is a win for United Technologies (NYSE:UTX), which is supplying the engines through its Pratt & Whitney unit and is trying to put production problems behind it, WSJ reports.
DAL’s decision to go with Airbus and Pratt is a sign of confidence in the Pratt geared-turbofan engine as well as “UTC’s ability to meet its aggressive targets to increase production over the rest of this decade,” says William Blair analyst Nicholas Heymann, adding that the engine portion of the deal could be worth as much as $1.5B-$1.6B for Pratt, although the figure could be lower after discounts.
Pratt has a backlog of more than 8K orders for the GTF - but the engine powers only 120 aircraft, spread over 18 different operators - and its ability to ramp up production to 750-800 engines in 2018 will be closely watched by investors, Heymann says.
The company's emerging from Chapter 11 with a "significantly strengthened" balance sheet, says CEO Jim Chirico.
Overall, we reduced our prior debt load by approximately $3B, and we exit today with more than $300M in cash on our balance sheet," he says. "The reduction of our debt and certain other long-term obligations will also improve annual cash flow by approximately $300M compared to fiscal 2016.
There's a new board and leadership team in place, he adds.
The company is taking steps to list on the New York Stock Exchange and expects to have about 110M shares outstanding.
Repros Therapeutics (NASDAQ:RPRX) announces that the European Medicines Agency's advisory group, the Committee for Medicinal Products for Human Use (CHMP), will likely adopt a negative opinion next month in response to its marketing application seeking approval for enclomiphene for the treatment of secondary hypogonadism.
Enclomiphene is one of two products in the company's pipeline (Proellex) so the news is a big negative for acquirer Allergan (NYSE:AGN).
Snyder's-Lance is up 3.4% after hours, after gaining 5.3% during today's regular session; Campbell is near-flat in late trading after 2.1% gains today.
That deal could value Snyder's at $50/share, a source tells the network, vs. today's close of $46.79; the deal could yet get delayed or fall apart entirely.
Such a deal for Snyder's-Lance (market cap: $4.6B) would be Campbell's largest. It wrapped a $700M acquisition of broth/soup company Pacific Foods this month and bought Bolthouse Farms for $1.55B in 2012.