Luis Alvarez
Stock futures edged higher on Wednesday as market participants eagerly awaited the Federal Reserve's interest rate decision.
Here are some of Wednesday's biggest stock movers:
Biggest stock gainers
- Take-Two Interactive (NASDAQ:TTWO) shares surged over 4% after TD Cowen reaffirmed its Outperform rating. The bank has a $173 price target for the stock, citing Take-Two's top-tier position in the global video game market and its long-term track record. The bank expects the release of Grand Theft Auto VI in early 2025 and the industry's most robust pipeline over the next several years. Analysts Doug Creutz and Mei Lun Quach are positive about Take-Two's growth, citing its development talent, intellectual property, and strong management. The bank expects above-GDP growth and high returns on capital in the video gaming industry over the next decade, deeming Take-Two a high-quality investment. The Nasdaq also said that Take-Two was being added to the Nasdaq-100 index, replacing Seagen.
- Vertex Pharmaceuticals (NASDAQ:VRTX) shares jumped 9% following the successful Phase 2 trial of its non-opioid pain therapy, VX-548, in patients with painful diabetic peripheral neuropathy. The trial, which included 192 patients, showed significant and clinically meaningful declines in pain intensity. All treatment groups achieved the primary goal, and the drug showed good tolerability across all doses during the 12-week period. However, one unrelated fatality occurred in the mid-dose VX-548 group due to cardiovascular disease related to plaque buildup. Vertex plans to engage in discussions with regulators to progress VX-548 to pivotal development for diabetic peripheral neuropathic pain.
- Mynaric (NASDAQ:MYNA) shares jumped as much as 15% after a contract with Northrop Grumman (NOC) was signed for the delivery of optical communication terminals under the U.S. Space Development Agency Tranche 2 Transport Layer-Alpha space vehicles program. The contract, valued at $33M, is expected to commence payment milestones in early 2024 and continue until 2026.
- Xponential Fitness (NYSE:XPOF) shares rose about 8% following Stifel's upgrade from hold to buy. Stifel believes the company's valuation is overly negative short-term sentiment, not significant fundamental issues. Analyst Christopher O'Cull suggests that if shares remain at current levels, management could partner with another investor to take the company private. Stifel reassures that there are no anticipated issues from the SEC's due diligence. The price target is now set at $18, a 95% increase from the last closing price.
Biggest stock losers
- Shares of Pfizer (NYSE:PFE) plunged about 9% after the company announced lower-than-expected 2024 guidance, including the impact of its new acquisition target, Seagen. The revised guidance projects 2024 revenue to reach $58.5B to $61.5B and adjusted earnings per share to be $2.05 to $2.25, much below the consensus of $63.2B and $3.17. The revised guidance includes approximately $8B in revenue from Pfizer's COVID products, Comirnaty vaccine, and Paxlovid pill, as well as a $3.1B contribution from Seagen (SGEN), which the company plans to integrate under a new division next year. Seagen and the company's non-COVID products are expected to deliver 8% to 10% YoY in operational revenue growth next year.
- Coherent (NYSE:COHR) shares fell 3% after Morgan Stanley downgraded the stock from overweight to equal-weight. According to Analyst Meta Marshall, the recent surge in stock performance has already incorporated the potential gains from artificial intelligence and machine learning in the near term. Marshall highlights a "lack of catalyst" for the upcoming year, citing concerns about macro and floating rate debt exposure. The price target set at $45 indicates a 7.6% increase from the last recorded price.
- Hertz (NASDAQ:HTZ) shares dropped over 4% after Oppenheimer downgraded it from Outperform to Perform due to anticipated challenges in 2024. Analyst Ian Zaffino highlighted obstacles to Hertz Global's electric vehicle initiative, high vehicle interest expenses, and increased DPU. Oppenheimer revised the estimated 2024 EBITDA to $823 million, with nominal free cash flow and a leverage ratio of around 3x. The firm argues that Hertz's valuation may not account for inherent risks, with a 6.6x 2024 estimated EBITDA for HTZ compared to CAR's 6.8x.