Nike, Bill Ackman, Walmart, Rank, Amazon – News Defused

Published 15/08/2024, 20:14
© Reuters.  Nike, Bill Ackman, Walmart, Rank, Amazon – News Defused
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Proactive Investors - Markets Defused is an easy-to-understand and straightforward recap of the day’s most engaging business and stock market news.

  • Nike shares rally on stake building by activist investor Bill Ackman
  • Walmart (NYSE:WMT) shares hit new high after financials impressed Wall Street
  • Rank Group (LON:RNK) trades up after returning to profit
  • Amazon’s Prime Air drones cleared for launch in UK

Nike shares rally on stake building by activist investor Bill Ackman

Nike Inc (NYSE:NYSE:NKE, ETR:NKE) shares traded higher as famed activist investor Bill Ackman acquired a new stake in the sportswear company.

Ackman’s investment company Pershing Square (NYSE:SQ) Capital Management, which recently flirted with an IPO before shutting the process down, has bought around 3 million Nike shares, according to a stock market filing.

It comes amidst turbulent trading for Nike which in past weeks has seen its shares fall following a profit warning.

Stiff competition from Adidas (ETR:ADSGN), which has seen a number of key lines ‘trending’ in 2024, as well as new rivals like Hoka and Roger Federer’s On brand has seen Nike lose market shares and measure sales declines.

Notably, Nike has this year seen softer sales in China.

Nike stock was down nearly 30% in 2024 to date, but has rallied in recent days.

On Thursday, the Ackman stakebuilding news helped push the shares to gain 5.6% to $82.86.

Walmart shares hit new high after financials impressed Wall Street

Walmart Inc (NYSE:WMT, ETR:WMT) shares rose to a record high in Thursday’s trade thanks to a largely upbeat earnings report card for its second quarter.

It highlighted strong sales growth, consumer-friendly price reductions and traction with its own-labelled product lines.

Revenue for the quarter totalled $169.34 billion, up nearly 5% from the same period last year and above market expectations that were pitched at $168.63 billion.

Earnings (adjusted) per share came in at 67 cents, beating Wall Street’s consensus forecast of 65 cents.

Overall, Walmart reported higher foot traffic and higher spending, particularly among these higher-income consumers.

Looking ahead, Walmart raised its full-year sales growth forecast to between 3.75% and 4.75%.

In New York, Walmart stock was up $4.78 or 6.96% rising to $74.44.

Rank Group trades up after returning to profit

Shares in Mecca Bingo owner Rank Group PLC (LSE:RNK) were up ‘lucky seven’ percent in Thursday’s dealing after the firm reported a return to profit.

Pre-tax profit for the financial year ended 30 June amounted to £15.5 million, compared to a £123.3 million loss a year ago. Revenue was up 9% for year at £734.4 million, with growth seen across all of Rank’s casino and bingo brands.

John O'Reilly (NASDAQ:ORLY), the CEO of Rank Group, stated that the company has seen continued improvement in trading due to ongoing investments in people, products, and facilities.

Looking ahead, meanwhile, Rank anticipates a 7% rise in employment costs for 2024/25, signaling some headwind against future profitability.

Greg Johnson, analyst at stockbroker Shore Capital, is bullish about Ranks prosects and valuation – which he reckons aren’t properly priced into the current share price.

In London, Rank shares were up 5.2p or 7.43% to 75.20p.

Amazon's Prime Air drones cleared for launch in UK

Amazon.com Inc (NASDAQ:AMZN) is approved to launch its Prime Air drone delivery service in the United Kingdom, with the British authorities greenlighting testing.

It is part of a broader effort led by the UK's Civil Aviation Authority (CAA) to explore the use of drones beyond visual line of sight (BVLOS) for various applications, including deliveries and critical infrastructure inspections.

Amazon is one of six organizations selected by the CAA, and it plans to use its drones to deliver small packages to customers.

The trials will involve advanced technologies for navigation, control, and the detection of other aircraft, ensuring that the drones can operate safely beyond the direct sight of their operators.

These trials will be a significant step forward in integrating drone operations into UK airspace.

Amazon has already launched similar drone delivery services in California and Texas.

Read more on Proactive Investors UK

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