Ambastha Financial LLC

By Kuldip K. Ambastha and Anil K. Ambastha

HAPPY HOLIDAYS, EVERYBODY!

During this week of Christmas, Peloton Interactive, Inc. (PTON) and WW International, Inc. (formerly Weight Watchers International, Inc.) (WW) caught our eye. On Thursday, December 26, 2019 (the day after Christmas 2019), Peloton dropped by 6.1%, while WW International fell by 8.5%. Peloton is a luxury exercise gear maker, while WW International offers products and services which help with weight loss, weight maintenance, fitness, plus other health & wellness matters. There was no particular news specifically on December 26 which led to the negative daily returns seen for the two companies on this day. However, news from prior days has continued to affect the stocks. Specifically, in early December, Peloton released a TV commercial which can be interpreted as controversial and sexist. The TV commercial shows a husband giving his wife a Peloton bicycle as a Christmas present. Many articles, both for and against the commercial, have been released online by writers after the commercial was released. Separately, WW International has struggled to show success in its 2019 re-branding campaign and failed to attract many new customers in the winter season. Oprah Winfrey is a prominent shareholder in WW International, and owns 8% of the company. This is the second-largest stake held in the stock of the company. Ms. Winfrey and many other celebrities will soon be traveling to different cities on an arena tour to promote WW International. It remains to be seen if WW International can re-brand successfully from a weight loss-focused company into one that instead serves customers via technology-based experiences with a human touch added on.

Keywords – Peloton Interactive, Inc., Peloton Interactive, Peloton, PTON, WW International, Inc., WW International, Weight Watchers International, Inc., Weight Watchers International, Weight Watchers, WW, luxury, exercise, gear, weight loss, weight maintenance, fitness, health & wellness, products, services, Christmas, holidays, winter holidays, holiday season, Oprah Winfrey, Oprah, O.

Disclosure – The principals and clients of Ambastha Financial LLC do not have any positions in PTON and WW.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2019 – Ambastha Financial LLC.

By Kuldip K. Ambastha and Anil K. Ambastha

On Thursday, December 19, 2019, Rite Aid Corporation (RAD) delivered a strong 42.3% return for the day. On that day, the company announced a quarterly earnings figure of $0.54 per share, for the quarter ending November 2019. This figure beat various consensus estimates quite significantly and thus qualifies as an earnings surprise. One year ago, the company had a quarterly earnings figure of $0.20 per share. In three of the past four quarters, the company has exceeded its earnings per share consensus estimate. For the most recent quarter, revenues of $5.46 billion were seen, and this figure is slightly higher than the $5.45 billion seen in the last quarter. Tight expense control and strong prescription count growth were helpful during the quarter. On Friday, December 20, 2019, Rite Aid stock went up by another 18.5%.

Keywords – Rite Aid Corporation, Rite Aid, RAD, pharmacy, retailer, earnings per share, earnings, EPS, earnings surprise, revenues, expenses, growth.

Disclosure – The principals and clients of Ambastha Financial LLC do not have any positions in RAD.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2019 – Ambastha Financial LLC.

By Kuldip K. Ambastha and Anil K. Ambastha

On Monday, December 9, 2019, big news emerged in the mergers & acquisitions field in terms of Merck & Co., Inc. (MRK) buying ArQule, Inc. (ARQL) and Sanofi SA (SNY) buying Synthorx Inc. (THOR). Both Merck and Sanofi bought the smaller companies to enhance their capabilities in the cancer treatment space. ArQule develops various pills focused on treating different types of cancer. Synthorx specializes in synthetic DNA base pairing which will create new drug products for cancer (plus autoimmune disease as well). The market reacted positively to this news in terms of the companies being acquired. ArQule stock rose by 103.9% on Monday, December 9, 2019, while Synthorx stock rose by 170.5% on the same day.

Keywords – Merck & Co., Inc., Merck, MRK, Sanofi SA, Sanofi, SNY, ArQule, Inc., ArQule, ARQL, Synthorx Inc., Synthorx, THOR, biotechnology, biotech, pharmaceuticals, pharmaceutical, pharma, healthcare, health, cancer, autoimmune disease, synthetic DNA base pairing, mergers & acquisitions, M&A, M & A.

Disclosure – The principals and clients of Ambastha Financial LLC do not have any positions in ARQL and THOR. The principals of Ambastha Financial LLC have long equity and short option positions in MRK and SNY. The clients of Ambastha Financial LLC have long equity positions in MRK and SNY, and a short option position in MRK.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2019 – Ambastha Financial LLC.

By Kuldip K. Ambastha and Anil K. Ambastha

On Thursday, December 5, 2019, there was “a tale of two cities,” to quote Charles Dickens. In the biotech arena, SAGE (Sage Therapeutics, Inc.) and AUPH (Aurinia Pharmaceuticals Inc.) were big movers. Sage Therapeutics delivered -59.7% for the day, while Aurinia Pharmaceuticals returned 78.8%. SAGE-217 is a depression treatment which failed to meet a critical goal in its late-stage study on treating major depressive disorder in patients, and thus Sage Therapeutics stock dropped significantly. In contrast, voclosporin (in combination with other items) is being tested by Aurinia Pharmaceuticals to treat lupus nephritis, and positive safety and efficacy data was seen in the Phase 3 study. Because of this positive news, the Aurinia Pharmaceuticals stock showed a strong gain. Again, there was “a tale of two cities” here for the day.

Keywords – Sage Therapeutics, Inc., Sage Therapeutics, SAGE, Aurinia Pharmaceuticals Inc., Aurinia Pharmaceuticals, AUPH, biotech, SAGE-217, late-stage study, depression, major depressive disorder, voclosporin, lupus nephritis, Phase 3.

Disclosure – The principals and clients of Ambastha Financial LLC do not have any positions in SAGE or AUPH.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2019 – Ambastha Financial LLC.

By Kuldip K. Ambastha and Anil K. Ambastha

Best Buy Co., Inc. (BBY), a big-box electronics retailer business headquartered in Richfield, MN, delivered strong results for 3Q2019. During the quarter, the company exceeded expectations on many fronts, such as earnings, revenues, and same-store sales. The key product and service lines which performed well were tablets, headphones, computing, tech support, and appliances. Corporate management has raised its guidance for 2020 profits and earnings. Best Buy has a strong mix of stores and online commerce which has been critical to its success in a highly competitive sector. Customers, in general, are more likely to make a purchase after seeing a product in-person vs. after browsing online. Furthermore, Best Buy has done well over the years in having the right product inventory at appealing prices. On Tuesday, November 26, 2019, the stock hit a 52-week high price of $83.63 per share. By the end of the day, BBY stock rose by 9.9% and was at $81.57 per share.

Keywords – Best Buy Co., Inc., Best Buy, BBY, big-box electronics, retail, Richfield, MN, Minnesota, The Gopher State, The Bread and Butter State, Land of 10,000 Lakes, The North Star State, 3Q2019, 2020, expectations, earnings, revenues, same-store sales, profits, products, services, stores, online, inventory, pricing.

Disclosure – The principals and clients of Ambastha Financial LLC do not have any positions in BBY.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2019 – Ambastha Financial LLC.

By Kuldip K. Ambastha and Anil K. Ambastha

Karuna Therapeutics Inc. (KRTX), a clinical-stage biopharmaceutical company, was founded in 2009 and is headquartered in Boston, MA. The company is focused on developing innovative therapies for individuals suffering from disabilities, disorders, and pain. Karuna Therapeutics Inc. has announced that its schizophrenia treatment’s Phase 2 clinical trial was successful. The treatment, KarXT, showed a significant and meaningful reduction in the acute psychosis of schizophrenia patients, and also was well-tolerated by trial participants. A Phase 3 clinical trial of KarXT will likely start by the end of 2020. Karuna Therapeutics Inc. had its IPO on Friday, June 28, 2019. On Monday, November 18, 2019, Karuna Therapeutics Inc.’s stock gained 443.0% for the day due to the news around KarXT. On Tuesday, November 19, 2019, KRTX stock advanced by another 29.1%. Overall, KRTX stock ended the week on Friday, November 22, 2019 being 380.8% higher than its stock price the prior Friday at the close of the market.

Keywords – Karuna Therapeutics Inc., KRTX, clinical-stage, biopharmaceutical, Boston, MA, Massachusetts, Commonwealth of Massachusetts, The Bay State, New England, East Coast, innovation, disabilities, disorders, pain, psychosis, schizophrenia, treatment, Phase 2, Phase 3, KarXT, IPO.

Disclosure – The principals and clients of Ambastha Financial LLC do not have any positions in KRTX.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2019 – Ambastha Financial LLC.

By Kuldip K. Ambastha and Anil K. Ambastha

Overstock.com, Inc. (OSTK) is an online retailer which offers a wide variety of products. Its stock fell by 17.4% on Tuesday, November 12, 2019 due to disappointing 3Q2019 results plus an investigation by the U.S. Securities and Exchange Commission (SEC). Specifically, a $0.89 loss per share was seen and this was more than the estimated $0.62 loss per share. Also, $347.1 million in revenue was received as opposed to the estimated $376.2 million. The SEC’s enforcement division is looking into the company’s digital dividend plans, the stock-trading plans of key executives, and communications with former executives. At the end of the trading day of Tuesday, November 12, 2019, the stock closed at $7.78 which is its lowest price in seven years.

Keywords – Overstock.com, Inc., OSTK, online retailer, 3Q2019, SEC, enforcement, loss per share, revenue, dividend, trading, communications, executives, trading, lowest price.

Disclosure – The principals and clients of Ambastha Financial LLC do not have any positions in OSTK.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2019 – Ambastha Financial LLC.

By Kuldip K. Ambastha and Anil K. Ambastha

Shake Shack Inc. (SHAK) is an American fast casual restaurant chain headquartered in New York, NY. The company announced its latest quarterly earnings and other key figures during this week. Same-store sales grew by 2.0% in 3Q2019, which was less than the 2.5% figure expected. The company also has stated that it will be entering into an exclusive delivery partnership with Grubhub Inc. (GRUB). Because of this fact, Shake Shack Inc. officials have warned of potential volatility in stock performance and key metrics in 4Q2019. Separately, the company is planning to shut some locations temporarily for upgrades which may improve the customer experience going forward. On Tuesday, November 5, the stock had a -20.6% return for the day, which was its biggest one-day percentage decline after its IPO.

Keywords – Shake Shack Inc., SHAK, Grubhub Inc., GRUB, New York, NY, New York City, NYC, American food, fast casual, restaurant chain, same-store sales, stock performance, key metrics, upgrades, customer experience.

Disclosure – The principals and clients of Ambastha Financial LLC do not have any positions in SHAK or GRUB.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2019 – Ambastha Financial LLC.

By Kuldip K. Ambastha and Anil K. Ambastha

On October 28, 2019, New York-based Tiffany & Co.’s stock (TIF) jumped 31.6% for a record one-day gain. The stock surged due to the announcement of a potential $14.5 billion (USD) acquisition bid from LVMH Moët Hennessy (LVMH). LVMH is a Paris-based French company headed by the third-richest billionaire in the world with an estimated net worth of about $102 billion USD, Bernard Arnault, and is traded in the over-the-counter (OTC) market with a stock ticker symbol of LVMUY. The company owns various brands including Louis Vuitton, Christian Dior, and Bulgari. The company offered to acquire Tiffany & Co., a 182-year old luxury jewelry retailer, for a non-binding, all-cash price of $120 per share, to expand into the U.S. market and increase its presence in the luxury jewelry space. Tiffany & Co. is considering this unsolicited offer due to its fiduciary duty to do so, and it is likely that other bidders may also emerge in the near future.

Keywords – Tiffany & Co., TIF, LVMH Moët Hennessy, LVMH, LVMUY, Bernard Arnault, Louis Vuitton, Christian Dior, Bulgari, U.S., France, luxury, jewelry, retail, M&A, mergers, acquisitions, over-the-counter, OTC, billionaire.

Disclosure – The principals and clients of Ambastha Financial LLC do not have any position in TIF or LVMUY.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2019 – Ambastha Financial LLC.

By Kuldip K. Ambastha and Anil K. Ambastha

On October 22, 2019, Biogen Inc. (BIIB) delivered a 26.1% return for the day. This was the stock’s largest one-day percentage return in 23 years. Its Alzheimer’s drug (aducanumab) had previously been written off as a failure, but now will be getting a second chance at approval from the U.S. Food and Drug Administration (FDA). Phase 3 trials for aducanumab in March 2019 were less than ideal, but now Biogen Inc. has disclosed new data from the Phase 3 trials that shows a marginally beneficial impact in Alzheimer’s patients. If fully approved, aducanumab will be the only approved treatment on the market for Alzheimer’s. Furthermore, during the week, Biogen Inc. announced that it had beaten its estimates on earnings per share (EPS) and sales for 3Q2019.

Keywords – Biogen Inc., BIIB, Alzheimer’s, aducanumab, healthcare, medicine, drug, earnings per share, EPS, sales, Food and Drug Administration, FDA, regulation, approval, pharmaceutical, biotech, 3Q2019.

Disclosure – The principals of Ambastha Financial LLC have short option position in BIIB. The clients of Ambastha Financial LLC have no position in BIIB.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2019 – Ambastha Financial LLC.