Pharma Stock Rallies 147%

Good morning. It's October 28th, and today we'll take a look at Boeing’s massive $19-billion stock offering, Philips taking a 16% hit amid China woes, and a pharma stock that is surging in premarket trade.

Previous Close 📈

Stocks were mixed last week, with the Nasdaq Composite hitting an all-time high while the Dow dropped 259.96 points and the S&P 500 inched down 0.03%.

With megacap tech companies like Alphabet, Microsoft, Meta, Amazon, and Apple set to report, investors are heading into a busy earnings week.

Futures

Stock futures are trading higher this morning. Dow futures are up 179 points (0.42%), S&P 500 futures have gained 0.53%, and Nasdaq 100 futures are up 0.73%, driven by strong expectations for tech earnings.

A decline in oil prices and easing geopolitical tensions after Israel’s weekend airstrikes, which did not target oil or nuclear facilities, are also supporting sentiment.

Technology

Bill Gates’ $100 Billion AI Move Could Be a Game-Changer

An intriguing new project called “Stargate” is reportedly underway, with Bill Gates and Microsoft leading the charge in AI innovation.

While details have been scarce, early footage has recently surfaced, revealing the scope of what Gates believes could reshape industries.

In 2016, Nvidia was just breaking onto the AI scene, and those who spotted its potential have since seen 20,000% returns.

Now, this new project could mark a similar opportunity, giving early investors the chance to benefit from the next wave of AI transformation.

Forbes describes Gates’ Stargate initiative as something that “will eventually reshape everything.” With AI expected to continue expanding into nearly every sector, this could be a pivotal moment for those watching closely.

Get a first look at what’s in store with Gates’ groundbreaking project and see if this AI investment might be the next big opportunity.

What to Watch

On Semiconductor (NASDAQ: ON) and CenterPoint Energy (NYSE: CNP) will announce their quarterly earnings before the opening bell.

Cadence Design Systems (NASDAQ: CDNS), Ford Motor Company (NYSE: F), Brown & Brown (NYSE: BRO), SBA Communications (NASDAQ: SBAC), Regency Centers (NASDAQ: REG), and F5 (NASDAQ: FFIV) will also share their numbers after the market closes today.

Energy

CenterPoint Energy Sees Profit Decline in Q3, Maintains Full-Year Forecast

CenterPoint Energy (NYSE: CNP) reported decreased third-quarter earnings as rising operating and maintenance costs are impacting its bottom line.

The Houston-based electric and gas utility’s net income is touching $193 million, or 30 cents per share, down from $256 million, or 40 cents per share, in the same period last year. Adjusted earnings are 31 cents per share, matching analyst expectations.

The company cited higher costs, along with unfavorable weather conditions, including Hurricane Beryl, as factors affecting quarterly performance. Despite these challenges, CenterPoint is maintaining its full-year adjusted earnings outlook of $1.61 to $1.63 per share.

In a positive note for investors, CenterPoint’s 2025 guidance is projecting adjusted earnings between $1.74 and $1.76 per share, surpassing the consensus forecast of $1.73. This favorable outlook is boosting CenterPoint’s shares, which are rising by 1% in premarket trading to $29.60.

CenterPoint’s resilience in managing expectations despite near-term cost pressures positions it as a stable player for the upcoming fiscal year, with strong guidance that has reassured investors.

Medical Devices & Electronics

Philips Suffers Massive One-Day Stock Drop Amid China Market Woes

Philips’ (NYSE: PHG) stock is tumbling more than 17% in premarket trading today. The firm announced LP a significant decline in Chinese sales, prompting a reduction in its full-year sales outlook.

The Dutch medical devices company cited weakening consumer confidence and a state-led anti-corruption campaign affecting hospital orders in China as major factors behind the downturn.

The unexpected slowdown in China, which represents a substantial portion of Philips’ "growth geographies," is causing the company to revise its 2024 global comparable sales growth forecast down to 0.5%-1.5% from a previous target of 3%-5%.

Philips also reported flat comparable sales at 4.4 billion euros for the third quarter, falling short of the anticipated 2.1% growth, though adjusted EBITA rose 13% year-on-year to 516 million euros, aided by cost reductions.

This setback has interrupted Philips’ recovery trajectory after a 50% stock rise this year, following challenges related to a costly sleep aide machine recall between 2021 and 2023.

Today’s market reaction marks the steepest one-day drop in Philips’ shares in over two decades, underscoring ongoing economic challenges in China and the company's reliance on this key market.

Aerospace

Boeing Moves to Strengthen Finances with $19 Billion Stock Offering

Boeing (NYSE: BA) is launching a stock offering valued at approximately $19 billion as the company seeks to stabilize its finances amid an ongoing worker strike and persistent production issues.

This offering will include 90 million shares of common stock and $5 billion in depositary shares, aiming to reinforce the company’s cash position and prevent potential credit rating downgrades.

The aerospace giant has been struggling financially due to a prolonged machinists' union strike that began in September, affecting production of its crucial 737 MAX model, and ongoing regulatory constraints on jet production following a safety issue earlier this year.

These setbacks led to a reported $6 billion loss in the third quarter, and Boeing has warned of continued cash burn into next year.

To avoid falling below its investment-grade rating, Boeing has also entered a $10 billion credit agreement with banks, supplementing its plans to raise up to $25 billion through stock and debt offerings.

As labor disputes continue and credit agencies signal caution, Boeing is moving swiftly to maintain financial stability and address significant debt obligations over the next few years.

Election Profit Window

This Could Be the Most Important Move You Make Before the Election

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Evoke Pharma [EVOK] - Last Close: $5.30

Evoke Pharma's stock is rallying by 146% before today's opening bell.

The firm announced impressive real-world results for its nasal spray, GIMOTI, in treating diabetic gastroparesis (DGP) in patients also taking GLP-1 drugs for diabetes.

The study showed that patients using GIMOTI experienced significantly fewer emergency room visits, office visits, and outpatient visits than those using oral metoclopramide.

This reduction in healthcare usage demonstrates GIMOTI's potential to improve patient outcomes and lower healthcare costs.

Monte Rosa Therapeutics [GLUE] - Last Close: $4.89

Monte Rosa Therapeutics' stock is up 37% in premarket trading.

The firm is entering a global licensing agreement with Novartis to advance its VAV1-targeting drug, MRT-6160, and other molecular glue degraders (MGDs) for immune-mediated diseases.

This deal includes a $150 million upfront payment to Monte Rosa, along with potential milestone payments totaling up to $2.1 billion, plus tiered royalties on non-U.S. sales.

The partnership will accelerate MRT-6160's development, with Novartis handling all clinical and commercial efforts from Phase 2 onward.

Procept Biorobotics [PRCT] - Last Close: $68.77

PROCEPT BioRobotics' stock is up 17% in premarket trading today.

The company reported strong Q3 financial results and raised its 2024 revenue and adjusted EBITDA guidance.

The urology-focused surgical robotics firm's revenue increased 66%, driven by a jump in U.S. sales and international revenue.

With a record gross margin of 63.2%, improved system sales, and an increased average selling price, PROCEPT’s performance exceeded expectations.

The company also raised its full-year revenue guidance, now projecting a 63-64% annual growth, signaling robust demand and solid execution, which has boosted investor confidence.

AI

This $100 Billion AI Project Could Change Everything

A groundbreaking new AI project, known as “Stargate,” is quickly capturing attention, with none other than Bill Gates and Microsoft at the helm.

Early footage from a recent investigation reveals a glimpse into what might be one of the most ambitious AI undertakings yet.

Forbes has described Gates' Stargate initiative as something that “will eventually reshape everything.” With AI already transforming industries, this project could open doors to entirely new possibilities, propelling tech to the next level.

In 2016, Nvidia marked a turning point in AI stocks, and early investors saw a phenomenal rise of over 20,000%.

Stargate could present a similar breakthrough for those looking to be ahead of the curve in AI advancements.

Get an exclusive look at this unprecedented project and explore the potential impact on the future of technology.

Everything Else

• Waaree Energies shares surged 56% in a strong Mumbai debut after its $514 million IPO.

• Indonesia bars iPhone 16 sales as Apple fails to meet investment mandates.

• A weak economy and oil glut cut Sinopec's third-quarter earnings by half.

• The E. coli outbreak was traced to onions, so McDonald's will resume selling Quarter Pounders without them.

• Relief is seen in oil markets as Israeli airstrikes spared Iranian oil sites, and prices dropped sharply.

• Allegations of drug misconduct led to the resignation of Olympus CEO and shares plummeting.

• Weak demand and a property crisis cause China’s industrial profits to drop at record pace.

• Volkswagen's cost-cutting efforts threaten thousands of jobs in Germany.

That’s all for today. Thank you for reading. If you have any feedback, please reply to this email.

Best Regards,

— Adam Garcia
Elite Trade Club

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