HAPPY THURSDAY TO THE STREET
GameStop (GME) launched an audacious $56B bid for eBay (EBAY), waving a $20B financing letter from TD Securities (TD).
The catch: that letter only works if the combined company keeps an investment-grade rating, and Moody's (MCO) pegs post-deal leverage near 9x EBITDA.
High-quality, stable credit? From the OG meme stock? Color me dubious.
🟥 | US stocks slipped from record highs following topsy-turvy earnings, while oil resumed its climb.
📈 | One Notable Gainer: Datadog (DDOG) surged around 30% after a Q1 beat and Q2 revenue guidance well above consensus.
📉 | One Notable Decliner: Planet Fitness (PLNT) tumbled more than 30% after slashing its full-year earnings growth outlook.
— Brooks & Cas
MARKET SNAPSHOT
S&P 500 Heatmap. Credit: Unusual Whales
HANTAVIRUS OUTBREAK THIS YEAR?
A Dutch cruise ship sailing back from Argentina has spawned a hantavirus outbreak, leaving three dead and health authorities on four continents racing to trace passengers who disembarked weeks ago.
The WHO insists public risk is low. Nearly one-third of Kalshi traders don’t buy it.
Market Movers
FASTLY, FORTINET, SHAKE SHACK
📉 | Fastly (FSLY) tanked as Q2 guidance disappointed despite a Q1 beat.
📈 | Fortinet (FTNT) lifted full-year billings guidance well above prior forecasts.
📉 | Shake Shack (SHAK) missed Q1 estimates and posted a $2.6M operating loss.
📈 | AAON (AAON) topped Q1 estimates across the board and raised full-year revenue guidance by as much as 45%.
📉 | Vital Farms (VITL) posted a surprise Q1 loss and cut its full-year earnings outlook.
Tomorrow's Trade Idea, Today
AA-LIST UPGRADE
Stock Spotlight
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Sticky Situation
Wells Fargo's Timna Tanners has turned bullish on Alcoa, upgrading the aluminum producer to Overweight.
Tanners sees pricing power running well into 2027, citing limited global capacity additions and low inventories.
More Than Metal
The bull case isn't just about smelter economics.
Tanners flagged catalysts from Alcoa monetizing idled assets through data center conversions, with management hinting deals are in the works. A potential divestiture of the firm’s Massena East site could provide another near-term boost.
Aluminum futures have soared this year, fueled in part by the US-Iran war and tight global supply.
House Divided
Wall Street is split. Of the 15 analysts covering Alcoa, eight rate it Buy or Strong Buy, while seven sit at Hold or Underperform.
Tanners thinks there's still upside left in the can. The bears are waiting for the foil to crinkle.
Do you own any shares of Alcoa Corp (AA)?
OVERHEARD ON THE STREET
🛢️ | Saudi Arabia and Kuwait lifted curbs on US military access to their bases and airspace.
Kalshi Odds: “US-Iran nuclear deal?”
Before August: 41%
Before September: 47%
Before 2027: 56%
📱 | Apple (AAPL) agreed to a $250M class-action settlement over its delayed 'Apple Intelligence' Siri features, with eligible iPhone owners getting up to $95 per device.
⚖️ | Shivon Zilis, the mother of four of Elon Musk's children, testified in the OpenAI trial that Musk once offered Sam Altman a Tesla (TSLA) board seat.
🧺 | Whirlpool (WHR) suspended its dividend and halved full-year EPS guidance, blaming a 'recession-level industry decline' tied to the US-Iran war.
WEDNESDAY’S POLL RESULTS
Do you own any shares of McDonald's (MCD)?
▇▇▇▇▇▇ 🐂 Yup, I’m holding
▇▇▇▇▇▇ 🐻 Nope, not interested
▇▇▇▇▇▇ 👀 No, but I’m interested
And, in response, you said:
🐂 Yup, I’m holding — “Still the best option for fast food.”
🐻 Nope, not interested — “Not my circus not my monkey, but just because the food is toxic. Probably a steady investment though, particularly in down economies.”
👀 No, but I’m interested — “Not sure of the longevity if we have a recession.”
