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Apple will soar 15% higher as work-from-home demand drives record sales, Morgan Stanley says

Apple store
  • Morgan Stanley raised its price target for Apple stock to $152 from $144 on Thursday, implying a 15.1% surge from Wednesday's close over the next 12 months.
  • The bank's analysts expect the iPhone 12 lineup to revive handset sales and drive record quarterly profits and revenue.
  • Prolonged work-from-home activity will support Apple's Mac, iPad, and Services sales, the team added.
  • Watch Apple trade live here.

Record December-quarter sales are set to kick off a hugely positive year for Apple, Morgan Stanley said Thursday.

Analysts led by Katy Huberty lifted their price target for the iPhone maker's shares to $152 from $144, implying a 15.1% climb from Wednesday's close over the next 12 months. The team reiterated its "overweight" rating on the stock and views the tech sector as "attractive" over the next year.

Morgan Stanley expects Apple's revenue and profits to hit all-time highs in the fiscal first-quarter report, despite more conservative forecasts from investors. The bank projects double-digit revenue growth across all five segments. Early indicators point to above-consensus iPhone and Services revenues, and recent market trends stand to amplify a post-earnings pop, the team said in a note to clients.

"Given positioning into the quarter is muted after the rotation out of high-quality stocks over the past several months, we expect strong follow-through post-earnings and are buyers into the print," they added.

Read more: GOLDMAN SACHS: These 22 stocks still haven't recovered to pre-pandemic levels - and are set to explode amid higher earnings in 2021 as the economy recovers

Apple gained as much as 3.3% on Thursday. Tech stocks have led indexes higher in recent sessions after Netflix's fourth-quarter earnings blew estimates out of the water.

Past earnings reports from Apple showed investments in its Services and Wearables businesses offsetting slowing iPhone sales. Yet the iPhone 12 lineup unveiled in late 2020 should reinvigorate handset revenue, Morgan Stanley said.

The 5G-capable iPhones were Apple's most successful product launch in five years, and demand continues to outstrip supply despite 78 million forecasted shipments in the December quarter, according to the team. Both Morgan Stanley's fiscal first-quarter and full-year projections for iPhone shipments exceed the consensus forecast.  

Elsewhere in the lineup, the analysts see prolonged work-from-home and remote-learning activity propping up Mac, iPad, and Wearables revenues. Consumer survey data suggests computer and consumer electronic sales hit nine-month highs in the previous quarter as renewed COVID-19 lockdowns forced more people to stay home.

Though the data isn't specific to Apple, "we believe they served as strong tailwinds" for the company's computers and tablets, the team said.

Apple traded at $135.70 as of 11:40 a.m. ET Thursday, up 2.3% year-to-date. The tech giant has 71 "buy" ratings, 15 "hold" ratings, and three "sell" ratings from analysts.

Now read more markets coverage from Markets Insider and Business Insider:

Electric-car maker BYD sells $3.9 billion in stock after Tesla-led rally quintuples prices

US weekly jobless claims slide to 900,000 as coronavirus fallout continues into the Biden presidency

The chief investment strategist at a $9.6 billion volatility-focused money manager breaks down why the stock market is poised to get more chaotic in 2021 - and shares how investors can take advantage of it

AAPL

Read the original article on Business Insider

Apple will soar 15% higher as work-from-home demand drives record sales, Morgan Stanley says

Apple store
  • Morgan Stanley raised its price target for Apple stock to $152 from $144 on Thursday, implying a 15.1% surge from Wednesday's close over the next 12 months.
  • The bank's analysts expect the iPhone 12 lineup to revive handset sales and drive record quarterly profits and revenue.
  • Prolonged work-from-home activity will support Apple's Mac, iPad, and Services sales, the team added.
  • Watch Apple trade live here.

Record December-quarter sales are set to kick off a hugely positive year for Apple, Morgan Stanley said Thursday.

Analysts led by Katy Huberty lifted their price target for the iPhone maker's shares to $152 from $144, implying a 15.1% climb from Wednesday's close over the next 12 months. The team reiterated its "overweight" rating on the stock and views the tech sector as "attractive" over the next year.

Morgan Stanley expects Apple's revenue and profits to hit all-time highs in the fiscal first-quarter report, despite more conservative forecasts from investors. The bank projects double-digit revenue growth across all five segments. Early indicators point to above-consensus iPhone and Services revenues, and recent market trends stand to amplify a post-earnings pop, the team said in a note to clients.

"Given positioning into the quarter is muted after the rotation out of high-quality stocks over the past several months, we expect strong follow-through post-earnings and are buyers into the print," they added.

Read more: GOLDMAN SACHS: These 22 stocks still haven't recovered to pre-pandemic levels - and are set to explode amid higher earnings in 2021 as the economy recovers

Apple gained as much as 3.3% on Thursday. Tech stocks have led indexes higher in recent sessions after Netflix's fourth-quarter earnings blew estimates out of the water.

Past earnings reports from Apple showed investments in its Services and Wearables businesses offsetting slowing iPhone sales. Yet the iPhone 12 lineup unveiled in late 2020 should reinvigorate handset revenue, Morgan Stanley said.

The 5G-capable iPhones were Apple's most successful product launch in five years, and demand continues to outstrip supply despite 78 million forecasted shipments in the December quarter, according to the team. Both Morgan Stanley's fiscal first-quarter and full-year projections for iPhone shipments exceed the consensus forecast.  

Elsewhere in the lineup, the analysts see prolonged work-from-home and remote-learning activity propping up Mac, iPad, and Wearables revenues. Consumer survey data suggests computer and consumer electronic sales hit nine-month highs in the previous quarter as renewed COVID-19 lockdowns forced more people to stay home.

Though the data isn't specific to Apple, "we believe they served as strong tailwinds" for the company's computers and tablets, the team said.

Apple traded at $135.70 as of 11:40 a.m. ET Thursday, up 2.3% year-to-date. The tech giant has 71 "buy" ratings, 15 "hold" ratings, and three "sell" ratings from analysts.

Now read more markets coverage from Markets Insider and Business Insider:

Electric-car maker BYD sells $3.9 billion in stock after Tesla-led rally quintuples prices

US weekly jobless claims slide to 900,000 as coronavirus fallout continues into the Biden presidency

The chief investment strategist at a $9.6 billion volatility-focused money manager breaks down why the stock market is poised to get more chaotic in 2021 - and shares how investors can take advantage of it

AAPL

Read the original article on Business Insider

Electric-car maker BYD sells $3.9 billion in stock after Tesla-led rally quintuples prices

BYD
  • Chinese electric-car maker BYD raised $3.9 billion in an upsized stock sale, capitalizing on its soaring stock price.
  • The automaker - backed by legendary investor Warren Buffett - has seen shares surge more than 400% as investors pile into the futuristic sector.
  • BYD plans to use the funds to pay down debts and strengthen its position in China's exploding EV market.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

BYD - the Chinese automaker backed by legendary investor Warren Buffett - sold $3.9 billion in shares after outsized demand for electric-vehicle stocks saw the firm's valuation explode through 2020.

The company offered 133 million shares for HK$225 each ($29.03) on Wednesday, representing 14.5% of its Hong Kong-listed stock. The sale was initially set to include 122 million shares priced between HK$222 and HK$228, according to documents seen by Bloomberg. The final offering price represents a 7.8% discount to BYD's closing level on Wednesday.

BYD shares soared more than 400% over the past 12 months as investors doubled down on the EV sector. Tesla saw the bulk of the inflows, but competitors including BYD, Nio, and Kandi also benefited. BYD now boasts a market cap of roughly HK$717 billion ($92 billion).

Read more: GOLDMAN SACHS: These 22 stocks still haven't recovered to pre-pandemic levels - and are set to explode amid higher earnings in 2021 as the economy recovers

Demand for BYD's offering handily surpassed the increased supply, The Wall Street Journal reported. Hedge funds, institutional investors, and Chinese funds participated in the sale.

While several EV companies have tapped public markets in attempts to compete with industry-giant Tesla, few tout direct support from Berkshire Hathaway CEO Warren Buffett. The holding company bought a stake in BYD in 2008 and currently holds one-quarter of the automaker's Hong Kong-listed shares, according to a report from the automaker.

BYD aims to use proceeds from the sale to pay off debts and strengthen its position in China's burgeoning EV market. Sales of electric cars surged in 2020 as China's government pushes to become carbon-neutral over the next four decades. Where China represented just 5% of global EV sales in 2011, that share reached 50% in early 2020.

BYD closed at HK$248.40 ($32.04) on Wednesday.

Now read more markets coverage from Markets Insider and Business Insider:

The chief investment strategist at a $9.6 billion volatility-focused money manager breaks down why the stock market is poised to get more chaotic in 2021 - and shares how investors can take advantage of it

US stocks climb amid optimism around Biden's COVID-19 plan and stimulus push

US weekly jobless claims slide to 900,000 as coronavirus fallout continues into the Biden presidency

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US stocks climb amid optimism around Biden’s COVID-19 plan and stimulus push

NYSE traders
  • US stocks gained on Thursday as investors cheered the Biden administration's plan to better tackle the COVID-19 pandemic.
  • President Joe Biden on Wednesday revealed plans to accelerate testing, vaccine rollouts, and reopenings.
  • Initial jobless claims fell to 900,000 last week, according to the Labor Department. Economists expected claims to total 935,000.
  • Watch major indexes update live here.

US equities rose on Thursday as investors bet on the Biden administration to accelerate the nation's economic recovery.

President Joe Biden unveiled new plans for how the government will tackle the coronavirus pandemic on Thursday. The president aims to sign 10 executive orders and invoke the Defense Production Act to accelerate testing, vaccine distribution, and reopen schools and businesses.

Efforts to better curb on the virus's spread are set to join a push for additional fiscal support. The president called for a $1.9 trillion stimulus package earlier in the month that includes $1,400 direct payments, expanded unemployment insurance, and relief for states and municipalities.

Republicans are likely to oppose the measure, having previously balked at passing new aid for governments. Still, expectations for another large-scale spending bill have led analysts to lift growth forecasts and S&P 500 targets.

Here's where US indexes stood shortly after the 9:30 a.m. ET open on Thursday:

Read more: The chief investment strategist at a $9.6 billion volatility-focused money manager breaks down why the stock market is poised to get more chaotic in 2021 - and shares how investors can take advantage of it

Tech stocks continued to climb after Netflix's healthy earnings beat boosted indexes the session prior. Equities hit record highs on Wednesday as Biden's inauguration amplified hopes for fresh fiscal stimulus and a stronger economic recovery. The jump was the largest Inauguration Day return in nearly a century.

In economic data, weekly filings for unemployment benefits totaled an unadjusted 900,000 last week as the labor market's recovery continued to push up against elevated COVID-19 cases. Economists surveyed by Bloomberg expected claims to reach 935,000. 

Continuing claims, which track Americans receiving unemployment-insurance payments, fell to 5.1 million for the week that ended January 9. That came in below the median economist estimate of 5.3 million claims.

"Fiscal stimulus prospects, along with broader vaccine diffusion, are pointing to a brightening labor market outlook but with the pandemic still raging, claims are poised to remain elevated in the near-term," Lydia Boussour, lead US economist at Oxford Economics, said.

Read more: We spoke to Winklevoss-backed crypto platform Gemini about bitcoin, how to use stable coins, and why regulation won't kill the boom in digital currencies

United Airlines sank after its fourth-quarter report missed Wall Street expectations for revenue and profit. The company cautioned that, despite vaccines being distributed nationwide, the pandemic will weigh on travel activity throughout 2021.

Bitcoin slid below the $32,000 support level as sell-offs cut further into the cryptocurrency's bullish momentum. The token hit a 24-hour low of $31,310.75 before paring some losses.

Gold dipped as much as 0.7%, to $1,858.42 per ounce. The dollar weakened against a basked of Group-of-20 currencies and Treasury yields climbed slightly.

Oil prices fell but remained above the $50 support level. West Texas Intermediate crude dropped as much as 1.1%, to $52.75 per barrel. Brent crude, oil's international standard, declined 1%, to $55.51 per barrel, at intraday lows.

Now read more markets coverage from Markets Insider and Business Insider:

GOLDMAN SACHS: These 22 stocks still haven't recovered to pre-pandemic levels - and are set to explode amid higher earnings in 2021 as the economy recovers

The S&P 500 will jump another 8% - but looming risks could spark a sudden pullback, RBC says

'Final nail in the bear case coffin': Here's what 4 analysts had to say about Netflix's 4th-quarter earnings

Read the original article on Business Insider

AMC soars 37% after issuing $100 million in debt to stave off bankruptcy

amc theater nj 1
An open AMC theater in Linden, NJ is seen on January 8, 2021.
  • AMC soared as much as 37% on Tuesday after revealing it raised $100 million in a new debt offering.
  • The theater chain issued new debt due in 2026 at a hefty interest rate of 15%, according to an SEC filing.
  • The move bolsters AMC's cash reserves as the firm looks to avoid bankruptcy amid widespread theater closures.
  • Watch AMC trade live here.

AMC Entertainment rallied as much as 37% on Tuesday after announcing it raised $100 million to extend its cash runway amid widespread theater closures.

The world's largest theater chain issued new debt due in 2026 to raise the extra capital, according to a Securities and Exchange Commission filing published Tuesday. The bonds boast a hefty interest rate of 15%, though AMC's first payment isn't due until July. The theater chain also reserves the right to "pay in kind" by issuing additional bonds and paying a 17% interest rate.

Roughly 193 million shares traded hands by 1:30 p.m. ET Tuesday, more than six times AMC's average volume over the past three months.

The fundraising effort comes after multiple warnings from the company that it could quickly exhaust its cash reserves. AMC said in October it could run out of funds by the end of 2020 or in early 2021 "given the reduced movie slate for the fourth quarter" and weak attendance. While most of the chain's theaters are open, high-earning locations in New York, California, and Washington remain closed.

Read more: The head of active equity at Wells Fargo's $607 billion asset management arm shares how she worked her way up from the call center 29 years ago - and pinpoints 3 trends transforming the investment landscape today

AMC can still tap the stock market for additional cash. The chain announced plans to sell up to 50 million shares on December 29, adding to the 200 million shares AMC registered for sale earlier that month.

The debt issuance and possible stock sales have so far kept AMC from bankruptcy, but the moves haven't been kind to long-term shareholders. The company's stock sits roughly 60% lower from the year-ago period, joining travel and leisure companies as some of the hardest-hit by the pandemic.

Conversely, those trading the stock for short-term gains stand to mint healthy profits. Shares sit about 37% higher year-to-date, fueled by a swarm of investors betting the chain can avoid restructuring.

 AMC traded at $2.92 as of 1:30 p.m. ET. The company has three "buy" ratings, 10 "hold" ratings, and four "sell" ratings from analysts.

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AMC

Read the original article on Business Insider

US stocks slide as disappointing bank earnings prompt end-of-week sell-off

nyse
  • US stocks sank on Friday as investors digested disappointing bank earnings and a December slump in retail sales.
  • Retail sales shrank 0.7% in December as COVID-19 lockdowns cut into holiday-season spending, according to Census Bureau data published Friday. Economists expected sales to hold flat from November.
  • Less-than-stellar earnings reports from Citigroup and Wells Fargo led financials to drag on the S&P 500.
  • While Democrats' soft Senate majority lifts the odds of Biden signing his newly announced stimulus deal, Republicans could push for higher taxes to offset its cost or a stripped-down version of the measure.
  • Watch major indexes update live here.

US equities sank for a second-straight session on Friday amid a drop in retail sales and as President-elect Joe Biden rolled out his plan for additional fiscal stimulus.

Fourth-quarter earnings kicked off with JPMorgan beating revenue and profit expectations. The bank reported a 42% jump in net income, bolstered by the release of $2.9 billion in loan-loss reserves.

Other firms posted less positive results. Citigroup's revenue landed above estimates, but weaker-than-expected performance in its fixed-income division contributed to a miss on quarterly earnings. Wells Fargo shares slid after the firm's fourth-quarter revenue came up short of analyst estimates.

Here's where US indexes stood at the 4 p.m. ET close on Friday:

Read more: Global X's lithium and battery ETF returned 126% in 2020 as electric vehicle-driven demand surged. One of the firm's analysts shared 4 stocks he sees 'leading the rise' in the industry going forward.

Energy stocks joined sinking financials as the biggest underperformers in the S&P 500. Real estate and utilities stocks outperformed through the session.

On the economic data front, disappointing retail sales weighed on bullish sentiments. Spending at US retailers contracted 0.7% in December as COVID-19 restrictions offset holiday-season sales, according to Census Bureau data published Friday. Economists surveyed by Bloomberg expected sales to stay flat from the month prior.

November's reading was revised lower to a 1.4% contraction, suggesting surging coronavirus cases and lockdown measures swiftly cut into a V-shaped rebound in consumer spending.

"This likely is the nadir for retail sales, as the late-December stimulus and the pending stimulus under the Biden administration will boost both bank accounts and consumers' spirits," Robert Frick, corporate economist at Navy Federal Credit Union, said.

Read more: 'I don't believe that we've really left the recession yet': Bond king Jeff Gundlach lays out the 2 risks that investors should watch nearly a year into the pandemic - and shares the 4 components of a balanced, winning portfolio

Biden unveiled a $1.9 trillion fiscal relief plan on Thursday that includes $1,400 direct payments, expanded federal unemployment benefits, and state and local government aid. Democrats' victories in Georgia runoff elections greatly improve the party's chances at passing such a sweeping stimulus measure.

Yet GOP opposition could strip the bill of some components before its passage. Lawmakers could also call for higher taxes to justify the legislation's hefty price tag, a move that would surely rankle investors hoping for President Donald Trump's low tax rates to remain in place.

"At some point in early February, the relief package will probably end up being closer to $1 trillion," Edward Moya, senior market analyst at Oanda, said.

The prospects of additional stimulus, coupled with strong consumer spending at the start of the month, was enough for Bank of America to lift its near-term growth outlook. The bank's economists lifted their forecast for first-quarter growth in the US to 4% from 1% and boosted their full-year GDP estimate to 5% from 4.6%.

Read more: Barclays says buy these 8 conviction stocks set to gain with the reflation trade in 2021 - including one that could rally 76%

Bitcoin dropped below $36,000 as the cryptocurrency's volatile trading week came to a close. The token climbed back above $40,000 on Thursday but failed to retake the record highs seen one week ago.

Spot gold slid 1.2%, to $1,823.42 per ounce, at intraday lows. The US dollar strengthened against all Group-of-10 currency peers and Treasury yields declined.

Oil prices sank as the stronger dollar cut into its recent climb. West Texas Intermediate crude fell as much as 3.3%, to $51.83 per barrel. Brent crude, oil's international benchmark, dropped 3.2%, to $54.64 per barrel, at intraday lows.

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Monetary stimulus will remain in place well into economic recovery, Fed Chair Powell says

US consumer comfort tumbles to lowest point since July as COVID-19 surge cuts further into recovery optimism

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Monetary stimulus will remain in place well into economic recovery, Fed Chair Powell says

jerome powell fed mask
  • Federal Reserve Chairman Jerome Powell reiterated Thursday that the central bank is far from tapering its asset purchases or raising interest rates.
  • "Now is not the time to be talking about an exit" from easy monetary policy, the central bank chief said in a virtual discussion.
  • The comments come after various Fed officials suggested that inflation could pick up faster than expected and, in turn, prompt an early rate hike.
  • Powell rebuffed fears of an unexpected policy shift, noting the central bank will notify the public "well in advance" if it is considering changes to its policy stance.
  • Visit Business Insider's homepage for more stories.

Those worrying the Federal Reserve will prematurely rein in monetary stimulus have little to fear, Fed Chairman Jerome Powell said Thursday.

As COVID-19 vaccines roll out across the country, investors and economists have looked to Fed officials for any hints as to when its extremely accommodative policy stance could reach its conclusion. The central bank is currently buying $120 billion worth of Treasurys and mortgage-backed securities each month to ease market functioning, and its benchmark interest rate remains near zero to encourage borrowing.

An unexpected reversal from such easy monetary conditions risks spooking financial markets and cutting into the country's bounce-back. Powell emphasized on Thursday that the central bank remains far from adjusting monetary conditions and that markets need not worry about a surprise policy shift.

"Now is not the time to be talking about an exit," the central bank chief said in a virtual discussion hosted by Princeton University. "I think that is another lesson of the global financial crisis, is be careful not to exit too early. And by the way, try not to talk about exit all the time if you're not sending that signal."

Read more: 'Vastly technically disconnected': A market strategist breaks down the 3 indicators that show Tesla is overpriced - and says it's due for a 17% correction in the next 6 weeks

The messaging mirrors past statements from Fed policymakers. Early in the pandemic, Powell told reporters the central bank wasn't "thinking about thinking about" lifting interest rates. The Federal Open Market Committee noted last month that changes to its policy stance won't arrive until "substantial forward progress" toward its inflation and employment objectives is made.

Still, recent commentary from some officials has stoked some fears that the Fed could cut down on the pace of its asset purchases sooner than expected. Kansas City Fed President Esther George said Tuesday that inflation could reach the Fed's target "more quickly than some might expect" if the economy's hardest hit sectors quickly recover.

A swifter-than-expected rebound could prompt an interest-rate hike as early as mid-2022 Atlanta Fed President Raphael Bostic said Monday. The projection stands in contrast with the FOMC's general expectation for rates to remain near zero through 2023.

Powell reassured that, when the Fed starts considering a more hawkish stance, messaging will come well before action is taken. Treasury yields responded in kind, with the 10-year yield climbing nearly 4 basis points to 1.127 and the 30-year yield rising about 6 basis points to 1.874.

"We'll communicate very clearly to the public and we'll do so, by the way, well in advance of active consideration of beginning a gradual taper of asset purchases," the Fed chair said.

Read more: Morgan Stanley says to buy these 26 economically sensitive stocks poised to outperform as oil prices spike 10% by year-end

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US weekly jobless claims jump the most since March as America’s labor-market recovery falters

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  • New US jobless claims for the week that ended Saturday totaled 965,000, the Labor Department said Thursday, signaling the labor market's rebound weakened through the end of the holiday season.
  • Economists surveyed by Bloomberg expected a reading of 800,000 claims.
  • The data shows a sizable increase from the previous week's revised number of 784,000. The jump was the biggest since March.
  • Continuing claims, which track Americans receiving unemployment benefits, gained to 5.3 million for the week that ended January 2. That's above the consensus economist forecast of 5.3 million.
  • Visit Business Insider's homepage for more stories.

The number of Americans filing for unemployment benefits jumped last week as rising COVID-19 cases continued to cut into the labor market's recovery.

New US jobless claims totaled an unadjusted 965,000 for the week that ended Saturday, the Labor Department announced Thursday. That comes in well above the 800,000 claims expected by economists surveyed by Bloomberg. The reading is also greater than the previous week's revised total of 784,000, and reflects the biggest increase since March.

Continuing claims, which track Americans receiving unemployment-insurance payments, gained to 5.3 million for the week that ended January 2. That came in above the median economist forecast of 5 million.

More than 74 million Americans have filed for unemployment benefits since the pandemic first froze US economic activity in March. That's twice as many filings that were made during the 18-month Great Recession. And while the worst week of the previous recession saw filings total 665,000, claims have failed to break below 700,000 throughout the coronavirus pandemic.

 

Read more: Morgan Stanley says to buy these 26 economically sensitive stocks poised to outperform as oil prices spike 10% by year-end

While the rate of labor-market recovery has slowed, case counts continue to surge across the country. The US reported a record 219,090 new COVID-19 infections on Wednesday, according to The COVID Tracking Project. Hospitalizations reached 130,383 and virus-related deaths climbed above 375,000.

Recently published data detailing the labor market in November also offers a bleak look at the country's rebound. US job openings fell by 105,000 to 6.5 million in November, according to Job Openings and Labor Turnover, or JOLTS, survey data published Tuesday. 

The US hiring rate held steady at 4.2%, coming in just above levels seen before the pandemic despite more than 10 million Americans remaining unemployed.

Read more: Morgan Stanley says stocks are due for a period of underperformance in the weeks ahead as valuations hit a ceiling - and shares 3 areas of the market where investors can find returns now

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Affirm skyrockets 110% in first day of trading after $1.2 billion IPO

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Affirm CEO Max Levchin

Affirm spiked as much as 110% on Wednesday after the loan provider's public-market debut.

The company's shares started trading publicly at around 12:20 p.m. ET and quickly surged above its offering price of $49. Affirm raised $1.2 billion by selling 24.6 million shares in its initial public offering. The offering price had already been lifted twice, first from a range of $33 to $38 and then from a range of $41 to $44.

The post-IPO leap gives Affirm a market cap of nearly $24 billion based on shares sold in the offering. More than 15.5 million shares had traded hands by 1 p.m. ET. The company trades under the ticker "AFRM" on the Nasdaq exchange.

Affirm's debut marks the first major US IPO of the year and mirrors in-demand offerings seen at the end of 2020. Airbnb and DoorDash surged 112% and 86% in their respective first days of trading last month. The post-IPO pops lead some to question whether demand for first offerings was overextended and irrational. Last year saw IPOs raise a record amount of capital, with Wall Street's "blank-check" company frenzy providing a sizable boost. 

Read more: Why Roblox's jilted underwriters could still see a payday after the gaming startup abruptly switched plans from an IPO to direct listingipo m

The Wednesday rally shows promise for a slew of upcoming IPOs. Pet supply store Petco, secondhand-goods marketplace Poshmark, and game developer Playtika Holdings are all poised to offer shares later this year.

Affirm was founded by PayPal co-founder Max Levchin in 2012 and raised about $1.5 billion on the private market before its IPO, according to Crunchbase data. The company's revenue was up 98% in September 2020 from the year-ago period, according to a recent filing.

Peloton's growth played a major role in Affirm's success throughout the pandemic, as the exercise equipment manufacturer counts for 30% of the lending company's revenue.

Affirm traded 104% higher, at $100.01, at 1:12 p.m. ET on Wednesday.

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Twitter and Facebook have seen $51 billion in combined market value wiped out since booting Trump from their platforms

GameStop rips 93% higher as board-overhaul rally enters 3rd day

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Twitter and Facebook have seen $51 billion in combined market value wiped out since booting Trump from their platforms

Jack Dorsey Mark Zuckerberg
  • Facebook and Twitter have collectively seen $51.2 billion erased from their market caps over the last two trading sessions as investors balk at their banning of President Trump.
  • Facebook saw $47.6 billion erased from its public valuation, while Twitter's market cap dropped by $3.5 billion.
  • Both companies announced last week they would permanently ban the president, saying keeping him on their platforms posed too large a risk of additional violence.
  • The bans come as Trump faces blowback from the government and corporations for his role in inciting last week's violent riots at the Capitol.
  • Watch Facebook trade live here.
  • Watch Twitter trade live here.

Facebook and Twitter, the two largest social media platforms to permanently ban President Donald Trump for his role in last week's Capitol riots, saw $51.2 billion in combined market value erased over the last two trading sessions.

Companies across sectors have responded to the president's rhetoric in recent days by pausing political donations, making statements decrying his inflammatory remarks, and pulling products with links to right-wing movements. Facebook and Twitter possibly took the biggest retaliatory steps when they indefinitely banned Trump from their platforms on Thursday and Friday, respectively.

Both companies cited the risk of additional violence for their bans, but investors largely balked at the action. Facebook tumbled 4% on Monday and another 2.2% on Tuesday as shareholders dumped the stock, likely fearing the ban could drive users off the platform. By the time markets closed on Tuesday, Facebook's market cap sat $47.6 billion below its Friday level.

Read more: GOLDMAN SACHS: Buy these 50 under-owned stocks that will roar higher as growth and inflation lift off in 2021

Twitter plunged 6.4% to start the week and dipped another 2.4% as the sell-off continued into Tuesday's close. The declines saw Twitter's market cap drop by $3.5 billion.

To be sure, Twitter rose as much as 2.9% on Wednesday while Facebook wavered at its previous closing level. And analysts haven't lowered the stocks' median price targets following the bans, signaling the slides were likely knee-jerk reactions that will reverse over time.

Other tech giants responding to last week's insurrection have fared better through the week. Apple and Google have both climbed slightly since announcing after Friday's close they would remove right-wing social network Parler from their app stores. Amazon shares are up 1.6% since announcing on Sunday that it kicked Parler off of its web hosting service.

Read more: A former journalist who worked his way up to become one of Wall Street's best tiny-company stock pickers tells us the 4 pillars of the approach that's beating 98% of his competitors

Still, the actions could come back to bite tech companies in the final week of Trump's presidency. CNN reported on Monday that Trump might retaliate against tech giants for their bans. It's not yet clear what the president's actions would look like and if they will materialize before President-elect Joe Biden is inaugurated.

Facebook traded at $251.70 per share as of 10:25 a.m. ET Wednesday, down roughly 8% year-to-date.

Twitter traded at $47.94 per share, down 12% year-to-date.

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Read the original article on Business Insider