Changes to S&P Indices

valvoline-hd-logo#S&P Dow Jones Indices will make the following changes to the S&P MidCap 400 and S&P SmallCap 600 indices: #Valvoline $VVV will replace #Noble Corp. $NE in the S&P MidCap 400, and Noble will replace #Celadon Group $CGI in the S&P SmallCap 600 effective prior to the open on Tuesday, May 16.

S&P MidCap 400 constituent #Ashland Global Holdings $ASH is spinning off its remaining stake in Valvoline in a transaction expected to be completed prior to the open on Monday, May 15, pending final conditions. Ashland Global will remain in the S&P MidCap 400 post the spin-off transaction. Noble is ranked at the bottom of the S&P MidCap 400 and is no longer representative of the mid-cap market space. Celadon is ranked near the bottom of the S&P SmallCap 600 and is no longer representative of the small-cap market space.

#MaxLinear $MXL will replace #Exar $EXAR in the S&P SmallCap 600 effective prior to the open on Monday, May 15. MaxLinear is acquiring Exar in a deal expected to be completed on or about that date, pending final conditions.

#Lantheus Holdings $LNTH will replace #Tidewater $TDW in the S&P SmallCap 600 effective prior to the open on Tuesday, May 16. Tidewater is ranked at the bottom of the S&P SmallCap 600 and is no longer representative of the small-cap market space.

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Goodbye Tesla, hello Ferrari

ferrariTwo research firms upped their price targets for #Ferrari $RACE today following strong quarterly results that appear to put the company on track for early delivery of 2019 targets.

Morgan Stanley’s Adam Jonas, also named the stock a Top 3 Pick in U.S. Autos and Shared Mobility coverage, replacing electric carmaker #Tesla $TSLA .

In a research note, Morgan Stanley’s Jonas told investors he is moving Ferrari to be his third highest ranked stock in his U.S. Autos & Shared Mobility coverage, replacing Tesla, as the company demonstrates performance three years ahead of his expectations and pursues the balance of aggressive model line expansion while “preserving the hyper-exclusive mystique of the brand.” The analyst also raised his price target on the shares to $100 from $72, citing a “very significant” first quarter earnings beat featuring 40% incremental EBIT margins and strong cash flow. Additionally, Jonas argued that he looks for Ferrari’s high quality earnings to double in approximately five years. The analyst reiterated an Overweight rating on the shares given its stable and defensible qualities and as he is comfortable with “the more modest growth opportunities” around items like volume and pricing.

WHAT’S NOTABLE: The two stocks Jonas ranks above Ferrari in his U.S. Autos and Shared Mobility coverage are #Adient $ADNT and #Fiat #Chrysler $FCAU .

PERFORMANCE AHEAD OF EXPECTATIONS: Morgan Stanley’s Jonas was not the only analyst bullish on Ferrari this morning.

#Jefferies also raised his price target on the shares to $96 from $74 as the company’s first quarter results put it “firmly” on track for early delivery of 2019 targets. Analyst Philippe Houchois told investors in a note of his own that he believes the future looks set to include more cars at high ROIC. Extending exposure in autos should best ensure the higher growth rates and exceptional ROIC needed to support further multiple expansion, the analyst argued, adding that faster auto growth does not reduce opportunities to leverage the brand into other activities in parallel or at a later date. Nonetheless, Houchois noted that he thinks Ferrari is still looking for its rightful place among a rather disparate set of peers as EBIT margins move to the upper end of luxury peers, and with ROIC significantly higher than all given structurally low net working capital while multiples remain discounted. He reiterated a Buy rating on the shares.

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Investor Encourages Sale of Gigamon

id-gigamon#Elliott Associates said in its SEC filing regarding its new activist stake in #Gigamon, “The Reporting Persons intend to communicate with the Issuer’s management and Board about a broad range of operational and strategic matters, and intend to encourage the issuer to undertake a strategic review process including, without limitation, a potential sale of the Issuer or certain of its businesses or assets, in which the Reporting Persons may participate, as a means of enhancing shareholder value.
The Reporting Persons intend to review their investment in the Issuer on a continuing basis and may from time to time in the future express their views to and/or meet with management, the Board, other shareholders or third parties, including, potential acquirers, service providers and financing sources, and/or formulate plans or proposals regarding the Issuer, its assets or its securities.”
Shares of #Gigamon $GIMO are up 15% to $40.30 following news of the activist stake.

Pitney Bowes Move Sends Stamps.com Tumbling.

stamps#Pitney Bowes $PBI announced a new offering for its cloud-based #SendPro mailing and shipping solution. “Now for only $5 a month, businesses can receive full access to SendPro, including the ability to print stamps and shipping labels for the U.S. Postal Service and other major carriers, and flexible postage payment options.

The offer also includes a free 90-day trial, 10 lb scale, $15 in postage and supply kit with labels and stamp sheets, for a total value of $135.

SendPro delivers three times the benefits for small and medium businesses at one-third the cost of Stamps.com,” the company stated in its press release announcing the offering.

Stamps.com $STMP shares are down $7.50, or 7.5%, to $105.30. $PBI is unchanged.

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Straight Path jumps after unnamed suitor raises bid again to $3.1B

resize_StraightPathShares of Straight Path Communications $STRP re rallying again after the company announced earlier that its board of directors determined that a revised offer from an unnamed “multi-national telecommunications company” to acquire 100% of the issued and outstanding shares of Straight Path for $184.00 per share, reflecting an enterprise value of approximately $3.1B, which will be paid in bidder stock in an all-stock transaction constitutes a “superior proposal” as defined in Straight Path’s previously announced definitive agreement and plan of merger with #AT&T $T , dated as of April 9.

The unnamed bidder previously submitted an unsolicited offer on May 1 to acquire 100% of the issued and outstanding shares of Straight Path for $135.96 per share, reflecting an enterprise value of $2.3B, which has been superseded by the revised offer announced today, the company noted.

Prior reports from The Wall Street Journal and Reuters have indicated that #Verizon $VZ has submitted an offer to acquire Straight Path, thought the companies have not confirmed that. Straight Path has notified AT&T of the Straight Path board’s determination and, pursuant to the AT&T Merger Agreement, AT&T has the option for the next three business days to negotiate a possible amendment of that agreement to match or exceed the bidder’s offer, the company noted.

In pre-market trading, Straight Path shares have jumped $42.71, or 26.5%, to trade near $204 per share, well above the all-stock sweetened bid made by its unnamed suitor.

Box Office Battle for May 5-7 Weekend

‘Guardians Of The Galaxy Vol. 2’ guardians_of_the_galaxy_vol_2_by_batcrazyman-d95z0yzkicked off summer with a bang but fell shy of the expectations – #Disney’s $DIS superhero movie earned $145M in its U.S. debut over the May 7 weekend, narrowly missing expectations for $150M-$160M. The Chris Pratt-led superhero sequel received an A in audience polls from CinemaScore, holds an 81% critics rating on Rotten Tomatoes, and was produced with a reported budget of $200M. In foreign territories, “#Guardians” took $123.8M.
BOX OFFICE RUNNERS-UP: #Comcast’s $CMCSA “The Fate Of The Furious” added $8.5M in its fourth weekend, reaching U.S. and global totals of $207M and $1.16B. #Fox’s $FOX “The Boss Baby,” meanwhile, rebounded to third place with $6.2M, for a cumulative domestic total of $157M.
Rounding out the top five, #Lionsgate $LGF.A comedy “How To Be A Latin Lover” grossed $5.2M while Disney’s “Beauty And The Beast” added $4.9M, showing noteworthy staying power in its eight weekend. Other publicly traded companies in filmmaking include #Sony $SNE , Time Warner $TWX and Viacom $VIA .