Markets Defused aims to give an easy-to-understand and straightforward recap of the day’s most engaging business and stock market news.
- GameStop shares plummet on share sale news
- Raspberry Pi saw high demand for its London IPO shares
- Virgin Galactic rose ahead of Weekend launch
- Aramco IPO expected to raise over $11 billion
- Hertz is selling off Teslas for $25,000
GameStop falls as it launches new opportunistic share sale
GameStop Corp (NYSE:GME) shares were falling in an otherwise quiet Friday trading session, after revealing disappointing sales numbers and announcing another new equity raise.
In New York, the share price was down $12.05 or 25.9% changing hands at $34.50.
The retailer, and favourite of the so-called ‘meme traders’, intends to sell another 75 million new shares to investors. It comes after 45 million shares were sold last month, raising $993 million for the company.
First quarter sales, meanwhile, fell to $882 million from $1.24 billion last year, versus consensus Wall Street estimates of $995.3 million.
GameStop nonetheless narrowed its net loss to $32.3 million, or 12 cents per share.
It still disappointed compared to expectations, however, as analysts had previously forecast a 9 cents loss.
Last night, GameStop shares soared in ‘after hours’ trading as Keith Gill, the investor known as “Roaring Kitty,” announced he would be returning to livestream.
Gill, who played a significant role in the original meme stock rally with his bullish comments on social media, has not live-streamed since 2021. His various recent social media posts have, however, been a significant factor in GameStop volatile trading.
Raspberry Pi expected to price IPO at top end of range
Raspberry Pi appears to be in demand ahead of its upcoming London IPO, with the single-chip PC maker set to price the share sale at ‘the top end’ of its pricing range.
The IPO is expected to price at 280p, according to latest financial media reports.
At that level, the IPO will capture £179 million of proceed, and set an implied valuation of £540 million – just over £31 million of new capital is expected to raise from the sale of new shares.
The share offering is said to be ‘already oversubscribed’, ahead of next Friday’s float.
The IPO, confirmed last month, is supported by Lansdown Partners and Arm Technology Investments. Arm Holdings PLC (NASDAQ:ARM), the British semiconductor giant, supplies Raspberry Pi’s processing units.
This new listing is seen as a positive development for the London Stock Exchange, which has faced a challenging environment for new listings in 2023.
Virgin Galactic shares rise ahead of next launch
Virgin Galactic Holdings Inc (NYSE:SPCE) trading positively in Friday’s dealing, up 3% to 85 cents per share, as the space tourism company prepares for the final flight of its Unity spacecraft.
The last Unity spacecraft flight is scheduled for Saturday, 8 June.
It is part of the Galactic 07 mission, with the flight set to carry three private astronauts.
“It’s #Galactic07 Spaceflight Week!” Virgin Galactic wrote Monday on X (formerly Twitter).
“Excitement is in the air as preparations ramp up for the upcoming mission. The window opens Saturday, June 8, 2024. Let the good times roll.”
This is slated to be the final flight for Virgin Galactic’s Unity spacecraft, before the company halts commercial operations to develop its new Delta-class spacecraft.
Virgin’s next vessel, the Delta spacecraft, will have six passenger seats and could conduct up to eight spaceflights per month.
Passengers can buy their place on a Delta for $600,000, whereas Unity’s ticket price was $450,000.
Aramco IPO expected to raise over $11 billion
Aramco, Saudi Arabia’s national oil company, is reportedly going to raise over $11.2 billion from its upcoming secondary public share offering.
The world largest oil company announced that it will price 1.545 billion shares at 27.25 Saudi riyal ($7.27) each.
It prices the Aramco share sale at the lower end of the initial marketing range which was seen between 26.70 and 29 Saudi riyals.
The proceeds are expected to unlock a large cash-pile to support the Saudi government’s various high-cost infrastructure projects, often referred to as its "gigaprojects."
Global oil prices are currently under pressure amidst an uncertain demand outlook, despite the usual seasonal increase in gasoline consumption.
OPEC (the Organization of the Petroleum Exporting Countries), of which Saudi Arabia is the most influential member, recently extended both formal and voluntary supply cuts this month.
The share offering is believed to have seen stronger international demand, compared to Aramco's 2019 IPO, which raised $29.4 billion for the oil company.
Aramco's shares carry a substantial dividend yield, of 6.81%.
The Saudi government retains 82% of Aramco, while Saudi’s public investment fund owns 16%.
One of Saudi’s flagship ‘gigaprojects’ is the futuristic city of Neom, which is predicted to cost around $500 billion.
Hertz is selling off Teslas for $25,000
US car rental operator Hertz Global (NYSE:HTZ) is selling off used Teslas for an average price of $25,000.
Hertz is walking back its electric vehicle (EV) ambitions.
It is said to be selling the used EVs on a ‘no-haggle’ basis in its major metropolitan areas.
These cut-price sales comes as EV pricing has generally this year been discounted and deflated, alongside a significant increase in competition, not least as several Chinese manufacturers roll-out their more affordable EVs in both North America and Europe.
Most of the Hertz's used Teslas are 2022 and 2023 Model 3 sedans.
Hertz's decision to sell a large portion of its EV fleet marks a significant shift from its ambitious 2021 plans to order hundreds of thousands of Teslas, Polestars, and battery-electric GM models.