What Did the Stock Market Do? Feb. 16, 2021

Latest Updates:

Palantir Pulls Back After Earnings Due to Underwhelming Guidance

[Tuesday, February 16, 4:49 pm]
Contributed by Vivian Medithi

Palantir (NYSE:PLTR) stock was down more than 10% at the market close Tuesday after releasing FY2020 Q4 earnings results. While revenue came in ahead of estimates, full-year guidance for 2021 left some investors wanting more.

Revenue for the quarter was up 40% year over year, but a loss of 8 cents per share was a far cry from the analyst projection of 2 cents in earnings per share (EPS). While PLTR expects revenue growth of 30% for the coming year, analysts had that number pegged at 31%.

Palantir has been the subject of intense social media chatter of late, as we saw last month ahead of its Demo Day event.

Read more about Palantir here.

S&P 500, Nasdaq Close Day Lower

[Tuesday, February 16, 4:18 pm]
Contributed by Vivian Medithi

  • The S&P 500 closed lower by 0.06%
  • The Dow Jones Industrial Average closed higher by 0.20%
  • The Nasdaq Composite closed lower by 0.34%
  • The Russell 2000 closed lower by 0.72%

EV SPACs Revving Up Ahead of Impending Mergers

[Tuesday, February 16, 4:15 pm]
Contributed by Vivian Medithi

Electric vehicles (EVs) and special purpose acquisition companies (SPACs) had a banner year in 2020 and there’s no indication that’ll change any time soon. Peridot Acquisition (NYSE:PDAC) and Churchill Capital (NYSE:CCIV) stock are both up in trading Tuesday as their mergers approach.

Peridot Acquisition is eyeing a merger with Li-Cycle, a lithium-ion battery company with an emphasis on recycling components from old batteries. That deal values Li-Cycle at $975 million, and the combined company will be worth about $1.67 billion. The SPAC merger has unanimous support from both Boards of Directors and is now pending approval from regulators and shareholders.

Read more about Peridot Acquisition, Li-Cycle and PDAC stock here.

Meanwhile, SPAC investor darling CCIV is working to raise another $1.5 billion via a private investment in public equity (PIPE) to support its merger with luxury EV-maker Lucid Motors. While many details of that deal remain unknown, the new round of funding suggests the combined company’s valuation would be approximately $2 billion.

Read more about Churchill Capital, Lucid Motors and CCIV stock here.

Strategic Investment Sends Sundial Growers Stock Higher

[Tuesday, February 16, 2:50 pm]
Contributed by Vivian Medithi

Up 339% year-to-date through Feb. 12, Sundial Growers (NASDAQ:SNDL) is a testament to the strength of retail investors in the stock market today, who have largely bid up SNDL stock as a speculative cannabis play.

That bull thesis gained some credibility today with the company’s announcement of a $22 million deal with Indiva Limited, a Canadian cannabis producer specializing in edibles. Indiva, which trades on the Toronto Stock Exchange under the ticker NDVA, will use the money to fully retire its outstanding debt, as well as for working capital.

Approximately half of the deal will be realized via a private placement of NDVA stock, while another $11 million will come via non-revolving loan facility. The deal is set to close on Feb. 23, 2021 pending the necessary approvals.

While SNDL has been a big beneficiary of retail investor interest in recent weeks, many market observers have felt there was little to support the price action, or to suggest that the company is well-positioned to capitalize on that price action. InvestorPlace.com’s Divya Premkumar points out today that while the company has raised plenty of capital to pay down its own debts, it still has a very high rate of cash burn digging a new hole of red ink.

Meanwhile our own Thomas Niel says that while a turnaround is in play, its hard to say where volatile Sundial Growers is heading long-term. He recommends those who are long sell their shares before the short-squeeze collapses.

Read more about the Sundial Growers deal with Indiva here.

Midday Update: Stocks Holding Steady

[Tuesday, February 16, 12:34 pm]
Contributed by Vivian Medithi

  • The S&P 500 is up 0.02%
  • The Dow Jones Industrial Average is up 0.25%
  • The Nasdaq Composite is down 0.28%
  • The Russell 2000 is down 0.73%

3 Big Stories to Watch Today

[Tuesday, February 16, 12:31 pm]
Contributed by Vivian Medithi

  1. Bitcoin breaks $50,000. Quintessential cryptocurrency Bitcoin (CCC:BTC-USD) notched a new high Tuesday morning, breaking the $50,000 mark around 7:30 AM before giving up some of those gains in morning trading. The new record comes at a time of increased corporate and institutional interest in cryptocurrencies, with Elon Musk’s Tesla (NASDAQ:TSLA) announcing a $1.5 billion investment in BTC last week, and that the company would be accepting the cryptocurrency as a form of payment. That spurred a rash of statements across the automotive and financial sectors regarding investing in and acceptance of Bitcoin, and put plenty of gas in the tank for BTC bulls. InvestorPlace.com’s William White has more this morning on big companies getting involved with Bitcoin.
  2. U.S. Covid-19 case numbers are on the decline. Monday saw the lowest daily case count in the U.S. since October, with approximately 54,000 new Covid-19 infections reported. That’s a far cry from the Jan. 8, 2021, peak of more than 300,000 new cases. Experts say the decline is largely due not to vaccines, but to widespread use of masks, social distancing and other transmission-breaking measures. At this point any good news is good news, but it’s worth noting this relatively-positive news is still objectively bad; case numbers are still far higher than they were last spring and regional variants of the novel coronavirus additionally complicate things.
  3. Freezing weather heats oil prices over $60. The brutal winter weather hammering the U.S. this week has had a silver lining for oil and natural gas producers. Though the entire state of Texas is under a winter weather advisory, the spot price of oil climbed into the $60s for the first time since January 2020. The price of oil has rallied since the U.S. elections in November 2020, and sector investors have been increasingly bullish concerning the coming year.

Major Indices Open Higher Today

[Tuesday, February 16, 9:15 am]
Contributed by Vivian Medithi

  • The S&P 500 opened higher by 0.34%
  • The Dow Jones Industrial Average opened higher by 0.28%
  • The Nasdaq Composite opened higher by 0.24%
  • The Russell 2000 opened higher by 0.58%

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