A roundup of some of the North American equities making moves in both directions today
On the rise
Crescent Point Energy Corp. (CPG-T) soared higher after it forecast lower capital spending and output in 2021, the latest oil producer to focus on conserving cash, as it prepares for low prices over a longer horizon.
Energy companies have cut spending aggressively in a race to offset weak trends in fuel demand caused by the COVID-19 pandemic, with U.S. oil major Chevron on Thursday cutting billions off its long-term capital and exploratory budget.
However, Crescent Point’s reduction in output also comes at a time when Canadian oil companies are restoring output that they shut in, as prices recover from pandemic lows.
Crescent Point said it expects average production of 108,000 to 112,000 barrels of oil equivalent per day (boepd) in the coming year, as pace of activity remains low.
The company, which focuses primarily on light oil production in southern Saskatchewan, said it expects capital expenditures of $4750million to $525-million next year, with majority of the budget allocated to its key focus areas in Viewfield, Shaunavon and Flat Lake.
See also: After blazing energy rally, investors check the fuel gauge
Drugmaker Eli Lilly and Co. (LLY-N) was up after announcing with insurer UnitedHealth Group (UNH-N) they have partnered to conduct a study of Lilly’s COVID-19 antibody treatment bamlanivimab in high-risk Medicare patients.
The Food and Drug Administration last month authorized emergency use of bamlanivimab for treating non-hospitalized COVID-19 patients who are at risk of becoming severely ill, either because they are over the age of 65 or because they have underlying health conditions such as diabetes.
UnitedHealth is inviting members of its Medicare Advantage program to volunteer for the study. Study participants who indicate they have symptoms of COVID-19 and test positive will be administered bamlanivimab, which is given by intravenous infusion, by a nurse sent to their home.
By treating people as early as possible in the course of illness, the study aims to determine if Lilly’s drug reduces the severity of COVID-19, UnitedHealth’s chief scientific officer, Ken Ehlert, said on a conference call.
Bamlanivimab, custom-designed to target the coronavirus, is part of a class of drugs known as monoclonal antibodies.
American Airlines (AAL-Q) rose in the wake of saying Friday it expects its fourth-quarter average daily cash burn to be at the high end of its previously forecasted range of between US$25-million and US$30-million.
The U.S. airline industry is still losing billions of dollars every month as travel demand remains weak and recent coronavirus travel advisories have discouraged holiday travel.
“Rising COVID-19 case counts and associated travel restrictions..have resulted in a slowing of net bookings growth, which has persisted into December,” American said in a statement.
The U.S. airline now expects to end the fourth quarter with about US$14-billion in total available liquidity.
Delta Air Lines warned on Thursday it would lose about US$2-million more than forecast each day in the fourth quarter, but kept a target to halt its cash burn next spring.
Airlines are hoping that vaccine prospects will start lifting demand throughout 2021 but do not expect a full recovery for some time.
On the decline
RioCan REIT (REI-UN-T), one of Canada’s largest retail landlords, fell after slashing its monthly distribution to unitholders by one-third amid growing uncertainty about some of its tenants’ futures.
Under the new distribution plan, effective January, RioCan’s monthly payout will fall to 8 cents per unit from 12 cents, saving the real estate investment trust $152-million annually.
RioCan is best known for its suburban shopping plazas and its list of tenants range from movie theatres to retail apparel stores. Until now, management had resisted calls to slash its distribution, yet there had been speculation it would eventually happen because the real estate investment trust’s units were yielding 8 per cent after their price fell sharply this spring.
RioCan’s management team changed course late Thursday, attributing the decision in a statement to an “uncertain retail landscape” and the “unknown length and breadth of closures.”
- Tim Kiladze
CWB Financial Group (CWB-T) was narrowly higher after it reported its fourth-quarter profit edged down from a year ago, but the bank still beat expectations.
The bank says it earned net income available to common shareholders of $63.4-million or 73 cents per diluted share for the quarter ended Oct. 31, down from $67.5-million or 77 cents per diluted share a year ago.
Revenue totalled $236.6-million, up from $220.9-million in the same quarter last year.
Total provisions for credit losses were $19.6-million, up from $13.3-million in the same quarter last year, but down from $24.4-million in the third quarter.
On an adjusted basis, CWB says it earned 75 cents per share for the quarter, down from an adjusted profit of 78 cents per share a year ago.
Analysts on average had expected an adjusted profit of 74 cents per share, according to financial data firm Refinitiv.
Laurentian Bank Financial Group (LB-T) fell after it beat expectations even as it reported its fourth-quarter profit slipped to $36.8-million compared with $41.3-million a year earlier.
The Montreal-based bank says its profit amounted to 79 cents per diluted share for the quarter ended Oct. 31, down 90 cents per diluted share in the same quarter last year.
Revenue for the quarter totalled $243.5-million, up from $241.6-million a year earlier.
Provisions for credit losses amounted to $24.2-million for the quarter, up from $12.6-million for the fourth quarter of 2019.
On an adjusted basis, Laurentian says it earned 91 cents per diluted share in its latest quarter, down from $1.05 per diluted share a year ago.
Analysts on average had expected an adjusted profit of 73 cents per share, according to financial data firm Refinitiv.
See also: Canada’s big banks face their next pandemic challenge: How to grow in 2021
Shares of Cineplex Inc. (CGX-T) was down on Friday, tracking declines of U.S. peers, including AMC Entertainment Holdings Inc. (AMC-N), after Warner Bros. announced Thursday that 17 movies — its entire 2021 slate — would each arrive simultaneously in theaters and on its sibling streaming service, the underperforming HBO Max.
Rather than having to wait roughly 90 days, the period that studios have long given theaters to play films exclusively, HBO Max subscribers will receive instant access to big-budget extravaganzas,
While the move amounted to 17 shots in the arm for HBO Max, which has struggled to attract subscribers since its introduction in May for US$15 a month, it was also a strikingly grim comment on the future of movie theaters. Even with a widely deployed vaccine, which is expected in the coming months, WarnerMedia does not believe that moviegoing in the United States will recover until at least next fall, an assessment that stands in sharp contrast with what other major movie studios and multiplex chains have signaled.
Boeing Co. (BA-N) was down after its Chief Financial Officer said on Friday it is reducing its 787 widebody production to five jets monthly in mid-2021 from six, and delivered zero 787s to customers in November, as longer-haul travel demand remains weakened by the coronavirus pandemic.
Boeing’s Greg Smith also told a conference that there is no “normal profile” currently for jet pre-delivery payments or PDPs, which are tied to production rates. Boeing has been forced to cut production due to the 20-month grounding of its cash cow 737 MAX after fatal crashes and the pandemic downturn.
“I think we’ve got a couple years here where PDPs will be a little bumpy,” Mr. Smith said.
With files from staff and wires