NEW YORK, November 9, 2018 /PRNewswire/ --
U.S. stock saw a strong week pass by, led by uplifting political news. The midterm election results drove the market throughout the middle of the week after Democrats gained control of the House. Shortly after the results went public, Attorney General Jeff Sessions resigned at the request of President Donald Trump. The news sent the Dow Jones surging by over 500 points. Sessions' resignation cast a bright spotlight on the cannabis industry, giving cannabis investors and companies some positive news. His resignation sent big U.S. stocks like Tilray, Cronos Group and Aurora Cannabis' shares rocketing. The combination of Sessions' resignation and the Democrats taking control of the House could lead to important news for the cannabis industry. Namely, this can reverse Sessions' decision to rescind the Obama-era policy that protected states which had legalized cannabis. The Dow Jones surged almost 1,000 points, or 3.8% since Monday morning. Meanwhile, the S&P 500 Index rose by 3.38% and the Nasdaq Composite jumped by 3.1%. Square, Inc. (NYSE: SQ), Wynn Resorts, Limited (NASDAQ: WYNN), ARRIS International plc (NASDAQ: ARRS), The Trade Desk, Inc. (NASDAQ: TTD), Dropbox Inc. (NASDAQ: DBX)
According to MarketWatch, GMP Securities analyst Robert Fagan wrote in a note to clients: "Dems will now gain majority control of the powerful House Rules Committee, which previously acted as a dogged gatekeeper of positive cannabis reform for the past 2 years under the oversight of anti-cannabis Republican Pete Sessions. In our view, these midterm results combined with a strong pipeline of upcoming catalysts should serve to drive a decoupling of valuation multiples for the U.S. cannabis sector to eventually reach a premium over Canadian LP peers."
Square, Inc. (NYSE: SQ) topped analyst's estimates for its third quarter financial results. Despite the stronger than expected results, shares dipped by 9% over concerns about the Company's outlook. For the quarter, Square reported adjusted revenue of USD 431, increasing 68% year over year and surpassing estimates of USD 414 Million. The Company reported an earnings per share of USD 13 cents, also above analysts' estimates who forecasted for USD 11 cents. Square provided a weaker guidance, concerning investors about its competition. The Company forecasts earnings per share of USD 12 cents to USD 13 cents, while analysts are projecting USD 15 cents.
Wynn Resorts, Limited (NASDAQ: WYNN) shares plunged after missing its third quarter estimates. Shares fell by 12% after the opening bell on Thursday. Wynn reported earnings per share of USD 1.68, while analysts' called for USD 1.69 per share. Although, Wynn did top revenue estimates, reporting USD 1.71 Billion compared to the USD 1.66 estimates. The stronger revenue was led the Company's Wynn Palace and Wynn Macau operations, but Chief Executive Officer Matthew Maddox sees a slow-down in the Macau operations, saying it has been "sporadic."
ARRIS International plc (NASDAQ: ARRS) shares rocketed after CommScope (NASDAQ: COMM) announced on Thursday its intent to acquire ARRIS for USD 31.75 per share, USD 7.4 Billion. The merger would establish a combined company revenue of USD 11.3 Billion. The two will work together to advance technology within the wired and wireless communications market by extending network systems, 5G and Internet of Things (IoT).
The Trade Desk, Inc. (NASDAQ: TTD) shares plunged Thursday despite reporting third-quarter earnings and sales above expectations. The Company earned USD 30 Million, or 65 cents per share, in the quarter, compared with analysts' expectations of 50 cents per share. Revenue rose 50% to USD 119 Million while analysts had called for USD 117 Million. Trade Desk lowered its guidance from USD 456 Million to "at least USD 464 Million."
Dropbox Inc. (NASDAQ: DBX) shares rose in after-hours trading on Thursday after reporting a 26% growth in revenue of USD 360.3 Million from a year ago, ahead of analysts' estimates of USD 352.8 Million. The Company posted profit of USD 45 Million, or 11 cents per share, while analysts had called for earnings of 6 cents per share. During the last quarter, Dropbox launched an updated search engine it calls Nautilus, which takes advantage of machine learning. It also introduced technology it calls optical character recognition that lets users search scanned or saved images for text.
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