Markets: COVID Is Back

Today, we have to have nose tests to get ourselves onto an airplane on Thursday so this blog is mercifully short. COVID is back in the plus column in the USA and we need to prove we are healthy to enter the UK. 

Equity, Fairness Equitable, Letters, Scrabble, Equal

Image Source: Pixabay

Oil patch

*BP Plc reported earnings beats of 22 cents with a Q2 eps of 83 cents (adjusted) and a sales beat of $3.5 bn with sales hitting $37.998 bn vs an estimate of $34.592 bn by Zacks. It also upped its dividend by 4% to 5.46 cents/sh and announced a 1.4 bn buyback campaign.

*Schlumberger Ltd, normally supported by French descendants from the founding Alsatian brothers, was hit by concern about the price of oil and the dollar. SLB fell over 2.5% today.

*Energy Fuels, UUUU, recuperated by 1.9% today.

Healthcare

*Bausch Health Care suffered from problems with its total revenue and profit although individual lines of the group did well, including its Bausch & Lomb eye business which is what we bought in the first place. It fell 3% in the premarket EBITDA failed to get anywhere near the consensus at $2.16 mn blamed on the virus of course. The forecast was $32.12 bn. It also chopped its guidance by 4 mn to $8.4 to $8.6 mn. There were nice results for eyecare whose revenues hit $934 mn vs a forecast of $677 mn, a 38% beat. Bausch pharma sales hit $1.17 bn, vs forecasts of $6.987 mn, beating by 18%. This is an example of a company whose management fails to treat analysts right. It may be because it was cobbled together in the first place. Bausch also said it would offload its $350 mn in debt and spinoff its medical aesthetics business.

*Esperion Therapeutics, ESPR, reported that it is cutting its co-pay for its LDL cholesterol-lowering drugs NexLertol and NexLizat which helps explain the 67% rise in sales booked because the preventive cardio meds are being sold rather than given away. It is hard to figure this out. It also gained from payments from Daiichi Sanyo for milestones, mostly in Europe. This was offset by stock-based compensation. It has a new CEO. ESPR cut its expenses by 10% from the prior quarter and now expects full-year 2021 expenses of  $120-130 mn. 

*Zymeworks got its first milestone payments from Janssen Biotech under their 2017 deal for bispecific drug combos from ZYME's Azymetric and Effect platforms. The milestones go up to $282 mn for development plus up to $1.12 bn in commercial milestones. Moreover, Janssen has an option on 2 other bispecific programs. Despite the huge potential gains ZYME shares fell 3.5% today perhaps because this cash potential will make it harder for anyone to acquire the British Columbia bio firm, which is rumored to be for sale.

*Dr Reddy's of India is relaunching its generic Aleve from Bayer, naproxen sodium tablets. 

*A writer on SeekingAlpha tipped NovartisThermo Electron, and Medtronic, all of which we have written about because I own them and cover them. NVS, TMO, MDT. TMO is a US share and my largest holding. 

*Enlivex is up 5.0% but I know not why. ENLV rose over the man put in charge of its Allocetera plant build but this always sounded odd. Now having hit a high of being up 8% it fell back to a slightly lower price than Mon.

Financials

*Allianz SE, the German insurer, is being investigated by the SEC over how its supposed balanced funds lost heavily early in the covid-19 weeks of 2020. Sold to pension plans as being likely to avoid both losses and gains, it wound up mostly losing because its hedges were not in fact working. It did not produce plus returns while the route was going on because its options were not anywhere as sound or market neutral as pretended. This Alpha 750 fund was the worst of the lot losing 75% of its value in the 1st quarter of 2020, resulting in a lawsuit by Arkansas Teacher's Retirement fund which triggered further litigation from Blue Cross-Blue Shield and Milwaukee's city retirement plan. Structured funds aiming to avoid highs and lows are offered by hedge funds that do better than AZSEY, in part because they don't stick around after a big cut in valuations. As a serious insurance company, the Munich firm cannot simply close. We own it because it owns a chunk of a California hedge fund which does well but like many insurance firms, it covers a lot of territories. 

*Banco Santander recovered over 2.5% today in Europe hitting euros 3.14. 

*Mitsubishi Finance, MSBHF, is up 2.93% on no news. Fellow Japanese Sumitomo Mitsui, SMFG, is up 0.22%. This is because the dollar is falling vs the yen.

*CBOE is up 1.65% as it makes money in many foreign markets.

*Lazard (LAZ) is down because its latest funds pay off in greenbacks which are getting lower in value.

*After last week's bearish options today SPDR Gold Trust is said to be showing unusual bullish options. GLD

Tech & Tel

*Ericsson and Nokia may both lost in China because Huawei is the mobile phone choice of China Mobile, according to a pundit writing today. Of course, they will lose the China market, but in theory, they can make it up from westerners who don't trust China or China Mobile. 

*Chinese problems at Tencent chopped the price of Prosus by 7.5% and that of Naspers by 6.8%. Both

PROSY and NPSNY have other businesses not targeted by Beijing. 

*Tomra Systems, a recycling and sorting play from Norway, is up 4.56% today on no news. TMRAY.

*Qualcomm is down fractionally because it will not be making chips for the Google Tensor phone which will incorporate artificial intelligence and machine learning.  

Internet marketing

*Mercado Libre has a new consensus rating it buy. MELI.

*However our blighted Korean copycat Coupang has been further undermined by the charge that it manipulated its search engines to favor its own products over those of its advertisers. It is not certain that CPNG did this but the South Korea Fair Trade Commission presumably has its reasons. CPNG is also on the spot over its labor policies and worker protection.

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Comments

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William K. 1 year ago Member's comment

Wish you well on the trip, and say 'Ello to 'Eathrow for me, if you will.

I have been wondering what would happen if this plague does for a larger percentage of the populace. What would it be like with 20%fewer in the world? Would things change at all??

OR, is this the start of the prelude to the Judgement Day that few have been anticipating? THAT would certainly disrupt everything.