AT&T, Discovery, Veru, Shopify, and Delta Air Lines: Weekly News Digest (11 – 15 April)
How did AT&T shares react after the signing of the agreement with Discovery? What’s happening at Veru? Are Shopify shareholders ready for a change? Was Q1 2022 successful for Delta Air Lines? Find the answers in our weekly news digest.
WarnerMedia and Discovery completed their merger
On Monday 11 April, the shares of the world’s largest telecom company and major media conglomerate, AT&T Inc. (NYSE: T), jumped 7.74% to $19.63.
This was a reaction to the completed merger of WarnerMedia – a subsidiary of the holding – with Discovery. The two parties formed a new company named Warner Bros Discovery, after having announced their plan to create a competitor to Netflix and Walt Disney already in May last year.
By this agreement, the shareholders of AT&T and Discovery received 71% and 29% of Warner Bros Discovery shares, respectively. The new media company is valued at $140 billion. The shares of the combined company Warner Bros Discovery Inc. (NASDAQ: WBD), which started trading this Wednesday, immediately surged 5.35% to $26.
Warner Bros Discovery owns Discovery Channel, CNN, Warner Bros. Entertainment, HBO, Cartoon Network, and two streaming platforms: Discovery+ and HBO Max. The number of programming available is about 200,000 hours, including series, films, and live shows. By 2023, the company is projected to post revenue of $54 billion.
Veru: successful in testing its anticoronavirus drug
On 11 April, American biopharma company Veru released impressive positive results of phase three clinical tests for its new medicine against COVID-19. The company claims that sabizabulin decreases the death rate by 55% in hospitalised patients with medium and severe cases of COVID-19.
Veru representatives stated that they have already addressed the US Food and Drug Administration for permission to urgently use the new drug in the coronavirus therapy.
On the same day, the news sent Veru Inc. shares (NASDAQ: VERU) skyrocketing 182.3% to $12.28. On 13 April, the trading session closed with a 42.86% surge of the shares to $14.3.
Shopify is planning a stock split
On Monday, the market heard that Canadian company Shopify, which owns the Shopify platform for creating online shops, was planning a stock split.
The company is planning to simplify the structure of the share capital with a 10-for-1 stock split of its A and B class shares. When trades close on 28 June this year, the shareholders of the company will receive nine new shares for each share they already hold. However, this decision is yet to be approved by Shopify shareholders – the voting is scheduled to be held at the meeting on 7 June.
The market gave a muted reaction to the information about the planned split. On 11 April, the shares of Shopify Inc. (NYSE: SHOP) rose 2.35% to $617.38. On the next day, they dropped 4.26% to $591.06. Thereafter, the process repeated itself: A 2% growth was recorded followed by a drop of a bit more than 4%. On Thursday, trades closed at $579.51.
Delta Air Lines report: losses have decreased
On Wednesday 13 April, Delta Air Lines – one of the largest airlines in the world – presented its financial report for Q1 2022. According to the report, the company recorded a revenue of $9.35 billion – against the expected $8.92 billion. The net loss over January–March reached $940 billion, while the revised loss per share was $1.23. Here again, the market had underestimated the company with a forecast of $1.27.
The management of Delta Air Lines is being very optimistic while discussing plans for the current quarter. It is expected that in April–June, revenue will grow 93% compared to the Q2 2019 statistics. The rising number of bookings and increase in ticket prices will help achieve this growth.
After the market saw the report and the forecasts, the share price of Delta Air Lines (NYSE: DAL) jumped 6.21% to $41.02. Over the next trading session, the stock quotes rose 3.27% to $42.36. Note that the shares have been growing for four days in a row to a total of 15.3%.
AT&T's share prices rose almost 8% in response to the signing of the agreement with Discovery for the creation of the new media company, Warner Bros Discovery.
Biopharma company Veru reported success in the tests of its anticoronavirus drug, which sent its shares skyrocketing 182%.
Shopify management shared its plans for a stock split, but this news did not manage to make the shares grow noticeably.
Delta Air Lines reported its results for Q1 2022 – its revenue increased while its net loss dropped. Moreover, the airline voiced quite an optimistic forecast for the current quarter, which sent its shares up by a bit more than 6%.