Stock Market Today: Earnings, M&A Drive Stocks to New Highs

Stock Market

It was an action-packed session in the stock market today, marked by record highs, mergers, acquisitions and earnings.

Some of those earnings, like AT&T (NYSE:T), came before the open and helped lift the stock to new 52-week highs. Other notable reports, like Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL), will come after the close (although shares did rally to new 52-week highs in the session in anticipation of those numbers).

Let’s not waste any time and start with M&A, which helped improve the mood on Wall Street as the S&P 500 hit new all-time highs.

M&A in Action

LVMH, the owner of luxe brands such as Fendi, Dior, Louis Vuitton, Hennessy and others, recently put its sights on Tiffany (NYSE:TIF). The company confirmed that it’s in the early discussions to acquire Tiffany, while the offer is said to be at $120 per share. Shares of Tiffany closed higher by 31.6% at $129.73 on the news.

After reports last month stated that Fitbit (NYSE:FIT) was considering a sale, Google is in talks to acquire it. The news had Fitbit shares sprinting higher by about 30% on Monday. Of course, it’s no secret that Apple (NASDAQ:AAPL) is the largest player in the wearable smartwatch space, potentially putting Alphabet head-to-head with the company should it land the deal.

Prologis (NYSE:PLD) has agreed to acquire Liberty Property Trust (NYSE:LPT) for $12.6 billion in an all-stock deal. For each share of LPT that shareholders own, they will receive 0.675 shares of PLD. PLD expects to realize synergies of $120 million and a 10 to 12 cent boost to FFO per share.

Movers in the Stock Market Today

General Motors (NYSE:GM) has come to an agreement with the UAW, ending the 40-day strike. However, it’ll come at a hefty price, with cost estimates ranging from $2 billion to $3 billion, depending on the analyst. The four-year contract, which has been approved by a majority of workers so far, includes signing bonuses, better wages and the protection of 9,000 jobs via increased U.S. manufacturing investments.

Following its reverse merger with Social Capital Hedosophia (NYSE:IPOA), Virgin Galactic (NYSE:SPCE) made its public debut on the New York Stock Exchange Monday. Shares opened for trading at $12.34, but finished the day at $11.51. Virgin Galactic is the first publicly traded, commercial human spaceflight company. Its game plan is to be profitable by 2021, while beginning commercial flights in 2020. Virgin Galactic has already sold more than 600 tickets at $250,000 apiece, securing roughly $80 million in deposits.

In an interview on CNBC’s “Squawk on the Street,” Richard Branson, who plans to retain 51% control after the debut, stated, “If the public wants to dabble a little bit in a spaceship company, own a little bit of a spaceship company, they can now do so.”

With the ongoing popularity in both trucks and SUV sales, Ford (NYSE:F) is cutting two cars from its lineup. The Ford Flex and Lincoln MKT crossover will both be discontinued in 2020, along with 450 workers.

Apple just launched its newest member to the AirPod family, the AirPod Pro. Improved features include noise cancellation, sweat and water resistance, and a new in-ear design. Orders start today and they will hit stores Oct. 30. They are priced at $249, while ironically, Apple stock hit an all-time high at $249.25 on the day.

Heard on the Street Today

Roku (NASDAQ:ROKU) shares erupted higher in the stock market today, climbing 9.8%. Fueling the move was an analyst note from Bank of America analysts. They initiated the stock with a “buy” rating and $154 price target. As streaming increases, Roku should benefit as a neutral streaming provider.

Unfortunately, Lululemon Athletica (NASDAQ:LULU) didn’t receive a similar note. Instead, Citigroup analysts pulled their “buy” rating on the stock and assigned a price target of $204. They worry about margins as promotions increase at the retailer, according to their observations.

Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long GOOGL, AAPL, T and ROKU.

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