Daily Update - April 3, 2023
Selected highlights of the day:
By: Matthew Otto
Electric Car deliveries
Tesla has posted record quarterly delivery results, delivering 422,875 vehicles and producing 440,808 units in the first quarter of 2023. Both figures represent quarterly records for the company and were slightly better than what analysts were expecting. The news should provide some stability for Tesla’s stock, which finished the first quarter up over 68%, the best first-quarter performance ever, and is being closely watched by investors. The production and sales numbers are a positive result, and investors will be watching closely to see if the spread between production and deliveries grows as a percentage of total deliveries, which could signal a demand issue. Tesla has over 40 analysts covering the stock, with about 53% of them rating shares as a Buy.
The three major Chinese electric vehicle makers, NIO, Li Auto, and XPeng, reported their March delivery numbers, delivering a combined 38,203 vehicles, up from 34,787 in February and 36,433 in March 2022. While not all three companies managed to post growth, they delivered results as expected. Wall Street expects Chinese new energy vehicle (NEV) sales to increase by 30% to 40% in 2023 compared to 2022, and NIO, Li, and XPeng account for about 10% of the market for all-battery electric vehicles.
- TD Cowen analyst Bryan Bergin maintains Tesla with a Market Perform and raises the price target from $140 to $170.
- Deutsche Bank analyst Emmanuel Rosner reiterates Tesla with a Buy and maintains a $250 price target.
- Citi analyst Itay Michaeli reiterated a Neutral rating and a $192.00 price target.
- Oppenheimer analyst Colin Rusch reiterated a Perform rating.
- Bernstein analyst Toni Sacconaghi reiterated an Underperform rating and $150.00 price target.
- Goldman Sachs analyst Mark Delaney raised the price target to $225.00 (from $200.00) while maintaining a Buy rating.
Antibodies as agonist antibody medicines
IGM Biosciences has released its financial results for Q4 and the full year ending 31 December 2022, alongside an update on the latest developments. The company has announced that the initial clinical results from IGM-8444, an anti-death receptor 5 IgM antibody, demonstrated the potential of IgM antibodies as agonist antibody medicines. Additionally, the first patient has been dosed in a randomized clinical trial of IGM-8444 in combination with standard of care FOLFIRI chemotherapy and bevacizumab in second line metastatic colorectal cancer patients. The company has also initiated clinical studies of IGM-7354, an IgM targeted immunostimulatory IL-15 cytokine.
Interleukin-15 – is a cytokine, a type of protein that is involved in regulating immune system function. It is produced by a variety of cells, including immune cells such as dendritic cells and macrophages, as well as non-immune cells such as muscle cells. IL-15 plays a role in the proliferation and activation of several types of immune cells, including natural killer (NK) cells, T cells, and B cells. It also plays a role in the development and maintenance of memory T cells, which are important for long-term immunity. IL-15 has been investigated as a potential immunotherapy for cancer and other diseases, as it has been shown to enhance immune responses against tumors and infectious agents.
The company expects full-year collaboration revenue of approximately $3 million related to the Sanofi agreement. Additionally, the company expects full-year GAAP operating expenses of $290 million to $300 million, including an estimated non-cash stock-based compensation expense of approximately $50 million. Finally, the company expects to end 2023 with a balance of approximately $200 million in cash and investments, which is expected to fund its operating expenses and capital expenditure requirements into the second half of 2024.
- JP Morgan analyst Eric Joseph maintains IGM Biosciences with a Neutral rating and lowers his price target from $27 to $26.
- Morgan Stanley analyst Michael Lapides maintains an Equal-Weight rating and lowers his price target from $30 to $20.
- HC Wainwright analyst Robert Burns maintains a Buy rating and lowers his price target from $45 to $22.
- On Friday, Jefferies analyst Roger Song set the price target from $52 to $48.
Bank of America – Analyst keep the ratings but lower the price targets
- Wells Fargo analyst Whit Mayo maintains Bank of America with an Overweight rating and lowers his price target from $52 to $45.
- Goldman Sachs analyst Richard Ramsden leaves a Buy rating and lowers his price target from $39 to $35.
WWE and UFC under one Umbrella
Vince McMahon’s World Wrestling Entertainment is to be sold to Ari Emanuel’s Endeavor Group, the parent company of UFC. The deal would combine UFC and WWE into one publicly traded company, with Endeavor owning 51% of the new company and WWE shareholders getting 49%. The new combat sports and entertainment company would have an enterprise value of $9.3 billion.
In their Q4 and full-year 2022 financial results, SCYNEXIS reported the following numbers: an upfront payment received of $90 million from GSK for an exclusive agreement to commercialize and further develop BREXAFEMME® (ibrexafungerp tablets) for all indications, as well as potential future milestones and tiered royalties. BREXAFEMME® is a prescription medication that contains the active ingredient ibrexafungerp, which is treat vulvovaginal candidiasis, a common type of yeast infection in women
SCYNEXIS ended Q4 2022 with cash, cash equivalents and short-term investments of $73.5 million, and upon closure of the GSK transaction and receipt of the upfront payment of $90 million and will have a projected cash runway of more than two years.
- Ladenburg Thalmann analyst Michael Higgins has reiterated his “Buy” rating on SCYNEXIS and maintained his price target of $15.
- Guggenheim analyst Vamil Divan also maintains a “Buy” rating, but has raised his price target from $8 to $9.
Fast Food Layoffs
McDonald’s is closing its U.S. corporate offices for three days as the company lays off workers in a broader corporate restructuring, according to an internal email viewed by CNBC. The company had announced in January that it would be cutting jobs, but hasn’t disclosed how many workers will be affected. The layoffs are said to be aimed at helping the company innovate faster and work more efficiently, rather than as a cost-cutting measure. McDonald’s employs roughly 45,000 people in the U.S. across its corporate offices and company-owned restaurants.