In Depth

Five Stocks That Dominated the Movement Charts

Huzaifa Waseem
6 Feb 2024 · 5 minutes read

Here we look at some of the biggest movers last week, while only considering the companies with a market cap of at least $5 billion

Nexstar Media Group (NXST:US) shares rose 13.5% last week after several media outlets reported that the company is in early talks with Walt Disney (DIS:US) to acquire the ABC television network. Disney is exploring selling some traditional TV assets to focus on the rise of its streaming services.

ABC comprises a national TV network and eight regional stations. It has affiliation agreements with about 240 local television stations reaching almost all U.S. television households. Nexstar has 200 owned or partner stations in 116 markets, reaching over two-thirds of the U.S. population, as well as national TV networks such as CW and NewsNation. 

It was also reported that media entrepreneur Byron Allen has put forward a $10 billion bid to acquire Disney's ABC television network,

Congressman Ro Khanna was selling NXST shares earlier this year. 

Yum China (YUMC:US) stock jumped nearly 12% after investors reacted positively to the fast-food restaurant company’s investor presentation. The owner of the Taco Bell brand for China aims for high-single to double-digit sales growth over the next three years. Additionally, Yum China is targeting double-digit earnings per share growth during the same period, highlighting its commitment to financial performance. This will help Yum China to return $3 billion to shareholders over the next three years.

Moreover, Chief Financial Officer Andy Yeung stated that the company is increasing its target for net new-store openings in the current year. Yum China now aims to open between 1,400 to 1,600 new stores, up from its previous outlook of 1,100 to 1,300. These expansion plans reflect the company's optimism about its growth potential and market opportunities in China's restaurant industry.

Rep. Daniel Goldman sold $15,000 - $50,000 worth of YUMC stock in July this year.

DocuSign (DOCU:US) shares dropped around 12% last week and are down about 15% since the company reported its quarterly earnings two weeks ago. This is despite DocuSign raising its full-year forecast.

DocuSign anticipates revenue to fall within the range of $2.73 billion to $2.74 billion, exceeding the previous estimate of $2.71 billion to $2.73 billion. Subscription revenue is projected to range between $2.65 billion to $2.66 billion, with billings expected to be in the range of $2.80 billion to $2.82 billion.

For the third quarter, the company expects revenue to be in the range of $687 million to $691 million, surpassing the estimate of $685.5 million. For Q2, DOCU reported adjusted EPS of $0.72, compared to $0.44 in the prior year. 

Earnings per share reached $0.04, a significant improvement from a loss of $0.22 per share in the previous year. Revenue for the second quarter was $687.7 million, representing an 11% year-on-year increase.

Rep. Ro Khanna traded DOCU shares earlier this year.

Chewy (CHWY:US) stock slipped more than 12% as investors continued to reflect on the company’s weak Q2 report. The online pet supply retailer reported its second-quarter results that saw net sales reach $2.78 billion, marking a 14% year-on-year increase, consistent with the estimate of $2.76 billion.

Adjusted EBITDA amounted to $86.9 million, showing a 4.6% year-on-year growth, surpassing the estimate of $70.6 million. The adjusted EBITDA margin stood at 3.1%, the gross margin expanded by 20 basis points to 28.3%, while the net margin for the quarter was +0.7%.

The stock is down about 25% since the company reported Q2 earnings. This is despite the fact that Argus Research upgraded their rating on CHWY stock to Buy from Hold.

“Chewy, an e-commerce retailer of pet food and related products, has expanded its market share in the pet category, and believes that its focus on customer service has helped to differentiate it from competitors,” analysts wrote.

Ro Khanna also traded CHWY shares, which are down 43.2% year-to-date, in April this year.

J M Smucker (SJM:US) fell roughly 10% last week to hit 52-week lows after the company announced a deal to buy Hostess Brands. The agreement to acquire Hostess Brands is based on the price of $34.25 per share in cash and stock. This deal represents a total enterprise value of approximately $5.6 billion, including around $900 million of net debt. 

Based on the SJM’s estimate of Hostess Brands' full-year 2023 results, it translates to an adjusted EBITDA multiple of approximately 17.2x. When considering anticipated run-rate synergies of $100 million, the multiple becomes approximately 13.2x.

"With this acquisition, we are adding an iconic sweet snacking platform; enhancing our ability to deliver brands consumers love and convenient solutions they desire; and leveraging the attributes Hostess Brands offers, including its strong convenience store distribution and leading innovation pipeline, combined with our strong commercial organization and consistent retail execution across channels to drive continued growth,” said CEO Mark Smucker.

Congressman Ro Khanna disclosed in September this year he was selling some SJM shares a few weeks earlier.