Tuesday’s Pre-Market: Here’s What You Need To Know Before The Market Opens

U.S. stock futures rallied in pre-market trading on Tuesday as Americans head to the polls to vote in the presidential election. Dow Jones Industrial Average futures pointed to a gain of almost 400 points at the opening bell. Futures tied to the S&P 500 and the Nasdaq 100 traded in positive territory as well.  

In coronavirus news, TFF Pharmaceuticals revealed that it has partnered with Augmenta Bioworks to develop human-derived monoclonal antibodies (mAbs) for potential COVID-19 therapeutics. As per the terms of the agreement, the companies will work on one or more commercial therapies, using TFF’s Thin Film Freezing technology to develop dry powder formulations of specific mAbs for inhalation delivery directly to the lungs of patients. Weighing in on the potential of TFF’s technology, Maxim Group’s Jason McCarthy said, “If invasive disease is prevented, since these infections are major drivers of mortality in COVID, TFF-VORI could potentially save lives if used as a preventative measure.” 

As for corporate earnings, Mondelez International delivered better-than-expected Q3 results thanks to strong demand in developed markets. Revenue from developed markets gained 9.6% to reach $4.38 billion, and overall revenue grew 4.9% year-over-year to $6.67 billion, beating the Street’s $6.49 billion forecast. In response to the Q3 performance, Jefferies analyst Robert Dickerson reiterated a Buy rating and $62 price target, explaining, “Topline growth seems sustainable longer-term given end-market exposure, liquidity and leverage remain healthy, global share trends impressive, and emerging market trends increasingly reassuring, yet valuation is still discounted relative to other larger CPG multinationals.” 

Shares of SolarEdge Technologies, however, fell 16% in pre-market trading on Tuesday after it provided a weaker Q4 sales outlook driven by the COVID-19 pandemic. It now expects revenue of between $345 million to $365 million, which is lower than the $391 million in sales that analysts originally estimated. An 18% year-over-year decline in Q3 revenue resulted in the disappointing guidance.  

Diamondback Energy fared better in Q3, with its shares surging 6% following the strong print. Non-GAAP EPS of $0.62 exceeded the consensus estimate by $0.26, and revenue of $720 million beat Wall Street’s call by $7.73 million. After the earnings release, RBC Capital analyst Scott Hanold reiterated his Buy rating and $50 price target. “Management highlighted that it is starting to see the benefits of high-graded drilling… We think this is a slight positive update and think FANG shares could outperform peers modestly,” he stated.  

In other market news, AMC Entertainment shares plummeted 8.5% after the theater chain announced that it is looking to raise as much as $47.7 million in capital through a share offering. The company filed a shelf registration to offer up to 20 million shares of its class A shares at a maximum offering price of $2.39 each, with it executing the offering from time to time. Since the pandemic’s onset, AMC has been strapped for cash, with CEO Adam Aron noting, “the liquidity enhancing and leverage reducing actions that we already have taken and will further need to take, combined with our relentless focus on efficiency and cash management, are all crucial to navigating through this storm.” 

Meanwhile, shares of Aurinia Pharmaceuticals took a 10% tumble in after-hours trading on Monday following its announcement that the Phase 2/3 clinical trial evaluating voclosporin ophthalmic solution (VOS) for the potential treatment of dry eye syndrome (DES) failed to meet the primary endpoint of a 10mm or greater improvement in the Schirmer Tear Test (STT) at four weeks. Based on the disappointing topline data, the biopharma suspended this development program.  

DraftKings gained 2% in Tuesday’s pre-market session, with investors cheering its new exclusive, multi-year relationship with golfer Bryson DeChambeau. The golfer is currently ranked No. 6 in the Official World Golf Ranking, and is coming off his first major championship at the U.S. Open in September. Although shares have declined 40% in the last month, Northland analyst Greg Gibas remains with the bulls, arguing, “We believe the company has been successfully positioning itself to establish early market share in new states and will continue to do so in upcoming state launches, starting with Michigan, and eventually in other key markets expected to go live in the coming years.” 

On the M&A front, Coupa Software acquired supply chain software company LLamasoft for $1.5 billion to improve its product offerings. The move will strengthen Coupa Software’s supply chain capabilities and offer customers better business spend management products, according to management. After the news broke, Raymond James analyst Brian Peterson reiterated a Buy rating on the stock with a $300 price target, pointing out that like Coupa, Llamasoft “markets a high ROI ($15 billion in cumulative customer savings) for its AI-based planning software that targets better management and visibility around supply chain spending.”