HAPPY FRIDAY TO THE STREET
President Trump just forced a rare concession from Big Pharma.
Pfizer $PFE ( ▲ 0.6% ), Merck $MRK ( ▲ 0.4% ), Bristol Myers $BMY ( ▲ 1.61% ), and a half-dozen peers agreed to voluntarily lower drug prices in the US, potentially signaling a major shift in how Washington plans to pressure the industry.
…but, perhaps, not as major as it seems. This Sunday, we’re covering why the drug pricing revolution may not be the paradigm shift it seems. Stay tuned.
🟩 | US stocks rose as AI optimism firmed on deal headlines and policy signals; Nasdaq led, with chip shares rebounding into year-end.
📈 | One Notable Gainer: Oracle $ORCL ( ▲ 6.63% ) shares rose after TikTok agreed to sell US operations to a joint venture with Silver Lake.
📉 | One Notable Decliner: KB Home $KBH ( ▼ 8.54% ) shares fell after Q4 deliveries dropped to 3.6K and average prices fell 7% to $465K.
— Brooks & Cas
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MARKET SNAPSHOT
All Stock Heatmap. Credit: Finviz
Market Movers
LAMB WESTON, CARNIVAL, NIKE
Lamb Weston $LW ( ▼ 25.94% ) reaffirmed full-year revenue guidance that fell short of consensus despite a Q2 beat.
Carnival $CCL ( ▲ 9.81% ) flagged record booking volumes for 2026 and 2027 sailings and topped Q4 earnings estimates.
Nike $NKE ( ▼ 10.54% ) reported a sharp decline in China sales that overshadowed a quarterly beat.
Micron $MU ( ▲ 6.99% ) climbed again as strong AI-driven memory demand supported upbeat guidance and extended recent gains.
CoreWeave $CRWV ( ▲ 22.64% ) joined the Department of Energy’s Genesis Mission and receiving bullish coverage from Citi.
To monitor hot stocks in real time, check out The Street Feed.
Tomorrow's Trade Idea, Today
LYFT’S RIDE MAY GET BUMPY
A Great Year That May Not Repeat
Lyft $LYFT ( ▼ 2.22% ) is having a banner year on the surface. Shares have climbed 48% in 2025, putting the ridesharing company on track for its strongest annual performance ever.
But Wedbush thinks that momentum stops here.
Analyst Scott Devitt downgraded the stock to Underperform, arguing that investor optimism is colliding with a much tougher 2026 setup. His concern is structural, not cyclical. Devitt believes autonomous vehicles could meaningfully erode Lyft’s long term value, and that the market has not fully priced in that risk.
Why Autonomous Vehicles Matter More For Lyft
Wedbush’s core argument centers on exposure. Lyft generates nearly all of its business from US ridesharing and lacks the diversification of larger peers.
As autonomous vehicle operators scale, Devitt expects them to favor first-party distribution rather than relying on third-party platforms. In that scenario, Lyft risks being excluded from the most profitable parts of the ecosystem.
The analyst also warned that investors may be overstating Lyft’s terminal value in discounted cash flow models. If autonomous fleets compress margins or bypass platforms entirely, today’s cash flow assumptions could prove optimistic.
That risk becomes more pressing as autonomous technology moves from pilot programs to commercial reality.
Partnerships Help, But Control Still Matters
Lyft is not standing still. The company has announced a partnership with Google parent Alphabet $GOOGL ( ▲ 1.55% ) through Waymo to launch a robotaxi service in Nashville in 2026.
Wedbush views that deal as limited protection. Devitt notes that Waymo has not announced additional Lyft partnerships and may increasingly push users toward its own Waymo One platform as the technology matures.
That shift would leave Lyft with fewer seats at the autonomous table. Most analysts already sit on the fence, with the majority rating the stock a Hold.
Lyft’s recent rally reflects improving execution and sentiment. Wedbush’s warning is about what comes next. If autonomous vehicles reshape ridesharing faster than expected, 2026 may remind investors that not every smooth ride stays that way.
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OVERHEARD ON THE STREET
CNBC: UnitedHealth $UNH ( ▼ 0.22% ) said an independent audit led it to adopt 23 action plans amid DOJ Medicare billing investigations.
Reuters: Alphabet $GOOGL ( ▲ 1.55% ) and Palo Alto Networks $PANW ( ▲ 0.54% ) announced an expanded partnership, with PANW set to pay nearly $10B over several years.
FC: Visa $V ( ▲ 0.94% ) and Mastercard $MA ( ▲ 1.06% ) agreed to pay $167.5M to settle a class action over allegedly conspiring to keep ATM fees high.
TechCrunch: OpenAI is in talks to raise up to $100B, valuing it up to $830B, to fund surging AI compute costs.
Axios: DraftKings $DKNG ( ▲ 0.06% ) launched a CFTC-regulated prediction market in 38 states.
THURSDAY’S POLL RESULTS
Are you bullish or bearish on ServiceNow $NOW ( ▲ 1.26% ) over the next 12 months?
▇▇▇▇▇▇ 🐂 Bullish
▇▇▇▇▇▇ 🐻 Bearish
And, in response, you said:
🐂 Bullish — “The elements for a rebound on the stock price appear to be in place; perhaps just a matter of getting past investor 'jitters', although the time frame for that may be inconclusive at this point.”
🐻 Bearish — “They should focus on AI in customer support, not buying overpriced security firms.”
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