Morning Brew: Rubrik Gains Amid Cyberattack, Palantir Downgraded, and AbbVie Dividend Declared

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S&P futures vs fair value: -9.00. Nasdaq futures vs fair value: -25.00.

The S&P 500 futures are down 9 points (0.2% below fair value), Nasdaq 100 futures are down 25 points (0.2% below fair value), and Dow Jones Industrial Average futures are down 15 points (0.1% below fair value).

There's a negative trend in early trading on this quarterly options expiration day, which will lead to higher trading volume. The major indices have seen solid gains this week, increasing the sense that the market might pull back.

Treasury yields are slightly lower this morning. The 10-year note yield is down 2 basis points to 4.23%, and the 2-year note yield is down 3 basis points to 4.70%.

Today's economic calendar includes:

  • 9:45 ET: Flash June S&P Global U.S. Manufacturing PMI (previous 51.3) and Flash June S&P Global U.S. Services PMI (previous 54.8)
  • 10:00 ET: May Existing Home Sales (consensus 4.10 million; previous 4.14 million) and May Leading Indicators (consensus -0.3%; previous -0.6%)
  • 10:30 ET: Weekly natural gas inventories (previous +75 bcf)

In corporate news:

Today's News

Cybersecurity firm Rubrik (RBRK) is likely to benefit the most from a recent cyberattack on CDK Global, impacting auto dealers. Cantor Fitzgerald highlighted Rubrik’s positioning in data security and cyber resiliency, which is expected to gain more attention. Companies like Zscaler (ZS, Financial) and CyberArk (CYBR, Financial) could also see increased focus if the breach involves traditional network security issues. Additionally, CrowdStrike (CRWD, Financial) and Google's (GOOGL, Financial) Mandiant are expected to assist in the investigation.

Palantir Technologies (PLTR, Financial) faced a downgrade from Monness, Crespi, Hardt, with concerns about the enterprise software space. Recent results from companies like Salesforce (CRM, Financial) and Workday (WDAY, Financial) were reportedly downbeat, and the benefits from generative AI have been labeled a "revenue illusion" this year. The analyst also pointed out disappointing outlooks from MongoDB (MDB, Financial) and Oracle (ORCL, Financial), further impacting Palantir’s prospects.

AbbVie (ABBV, Financial) declared a quarterly dividend of $1.55 per share, maintaining its previous payout. The forward yield stands at 3.6%, with the dividend payable on August 15 to shareholders of record as of July 15. This declaration underscores AbbVie’s consistent dividend policy, providing a steady income stream for its investors.

Asana (ASAN, Financial) shares rose over 4% after the company reiterated its Q2 and FY2024 outlook and announced a new $150M share buyback program. The company reaffirmed its revenue targets, providing a positive signal to the market and boosting investor confidence.

Sun Country Airlines (SNCY) saw a 5% increase in shares following an amended and restated air transport services agreement with Amazon, extending the contract through 2030. The agreement allows Sun Country to operate additional Boeing 737-800 cargo aircraft, enhancing its cargo operations.

SoftBank Group (SFTBY) founder Masayoshi Son expressed regret over selling Nvidia (NVDA) shares five years ago. The decision to sell was made before Nvidia's significant rise due to the AI wave, resulting in a missed opportunity for substantial gains. SoftBank had initially bought the stake for about $700M and sold it for a return of $3.3B.

Kraft Heinz Company (KHC) might face a double-whammy in sales as its Lunchables and Capri Sun products deal with consumer backlash over ingredient concerns. Piper Sandler lowered its 2024 outlook for Kraft Heinz, citing the potential harm to overall sales from the negative consumer response.

Two top Canadian oil and gas lobby groups removed content from their websites due to a new law, Bill C-59, requiring proof of environmental claims. The law creates uncertainty for companies like Suncor Energy (SU), Cenovus Energy (CVE), and Imperial Oil (IMO) in communicating their environmental efforts publicly.

Microsoft (MSFT) was highlighted by Citi, which maintained its Buy rating and raised its price target. The positive news surrounding OpenAI, in which Microsoft holds a significant stake, includes increased annualized revenue and a deal with Oracle (ORCL, Financial) to expand cloud capacity. However, potential losses from OpenAI could impact Microsoft’s quarterly earnings.

Zealand Pharma (ZLDPF) reported compelling weight loss data from its experimental anti-obesity therapy petrelintide in an early-stage trial. The therapy led to an 8.6% average weight loss over 16 weeks at a high dose, showing promise as a strong answer to currently approved GLP-1 receptor agonists.

Smith & Wesson Brands (SWBI) anticipates healthy demand through the 2024 election cycle and fiscal 2025. CEO Mark Smith noted the expected tailwind from the election campaign, although the company faces a competitive market in the near term due to inflation impacting consumer discretionary spending.

Applied Optoelectronics (AAOI) settled its patent infringement dispute with Molex LLC on mutually satisfactory terms. The details of the confidential settlement agreement were not disclosed.

GE Aerospace (GE) declared a quarterly dividend of $0.28 per share, in line with its previous payout. The forward yield is 0.68%, with the dividend payable on July 25 to shareholders of record as of July 11.

Johnson & Johnson (JNJ) completed the acquisition of biotechnology company Proteologix for $850M, including potential milestone payments. This acquisition strengthens JNJ’s position in the biotechnology sector.

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I/We may personally own shares in some of the companies mentioned above. However, those positions are not material to either the company or to my/our portfolios.