Markets Defused gives an easy-to-understand and straightforward recap of the day’s most engaging business and stock market news.
- Microsoft and Crowdstrike stock recovers (a bit)
- Harland & Wolff CEO exited after failing to land Govt loan support
- Netflix has the right formula to keep growing - analyst
Microsoft and Crowdstrike stock recovers (a bit) after IT outage
Investors are evidently taking in their stride the immediate aftermath of what is being described as ‘potentially the world’s worst IT outage’ – with Microsoft Corp (NASDAQ:MSFT) stock clawing back the worst the morning’s losses.
At $437.48, Microsoft shares are down just $2.83 or 0.6% - having seen as low as $432 earlier, which equated to more than a 2% drop.
CrowdStrike Holdings Inc (NASDAQ:CRWD), the cyber security firm that’s taking more of flack, was meanwhile 11% lower at $305.33, though even so it traded as low as $290.10 earlier, a decline in excess of 15% earlier.
Nonetheless, the computing crisis is not yet over and it may be a while longer until potential ramifications and reputational impacts are better understood.
Daniel Ives, tech analyst for American stockbroker Wedbush, in a note praised Crowdstrike chief executive George Kurtz for the way in which he has fronted up and communicated well during the crisis.
Moreover, the broker reckoned the high profile incident won’t spoil a bullish long term story for the cyber security firm.
“Globally Kurtz has stepped up and helped the damage control immensely for CrowdStrike as it speaks to the stock rebounding from lows seen early this morning,” Ives said.
“CrowdStrike remains the gold standard and we believe this historical incident will only be a dark chapter for the company and not impact the long term bull story for the name.”
Harland & Wolff CEO exited as shipbuilder failed to land Govt loan support
Harland & Wolff Group Holdings PLC (AIM:HARL) debt crisis took another turn on Friday as the Belfast shipbuilder failed to secure a £200 million loan guarantee from the UK government, and subsequently chief executive John Wood exited with immediate effect.
According to a statement, Wood is taking a “leave of absence”.
Meanwhile, Russell Downs, a restructuring expert, has been appointed as interim executive chair.
It is now resuming talks with its existing lender, with the hope of securing new financing within days.
At the same time, an investment bank has been hired to explore strategic options, which may include a potential sale of the company.
Harland & Wolff had applied for the government loan guarantee as it sought to refinance a £90 million high-interest loan, as well as fund its operations to satisfy a major Royal Navy contract.
Netflix has the right formula to keep growing, says tech analyst
Netflix Inc (NASDAQ:NFLX, ETR:NFC) has landed on the right formula to continue growing its business despite challenges, that’s the view of analysts at American stockbroker Wedbush.
The streamer, which last night released expectation-beating financials for its second-quarter in which it reported revenue, earnings and subscriber numbers all ahead of Wall Street expectations.
Its outlook for the next quarter was slightly softer than the market anticipated, which dampened overnight interest in the stock.
Nonetheless, market commentators including those at Wedbush focused in particular on the evident popularity of Netflix’s ad-supported subscription tier – which is cheaper for users who are prepared to watch ads whilst streaming.
“The most significant benefit of the ad tier so far is that it limits churn. Netflix is positioning to accelerate ad tier revenue contribution into 2025 as it improves its advertising solutions and targeting, expands partnerships, and adds more live events,” Wedbush analyst Alicia Reese said in a note.
“With this set-up, the ad tier should become the primary growth driver in 2026. We think Netflix has reached the right formula with global content creation, balancing costs, and increasing profitability.”
Wedbush has an ‘outperform’ rating for Netflix, with a 12-month price target of $725 (vs a current price of c$643).