Altria Group (DOG)
MO - NYSE
Talk about money going up in smoke. Less than four years after tobacco giant Altria Group paid nearly US$13-billion for a 35-per-cent stake in Juul Labs Inc., the U.S. Food and Drug Administration this week ordered the controversial e-cigarette maker to pull all of its vaping devices and cartridges from the market. Even before the FDA ruling sent Altria’s shares down sharply, the cigarette maker had written down the value of its Juul stake to US$1.6-billion amid growing concerns about the rapid rise of vaping and nicotine addiction among teens and young adults. Kids, this is why you should never start smoking tobacco – or investing in it.
Voyager Digital (DOG)
VOYG - TSX
Hedge funds. Crypto. Huge loans. What could possibly go wrong? Shares of Voyager Digital plunged more than 50 per cent on Wednesday after the crypto trading platform said it “may issue a notice of default” to Three Arrows Capital over a roughly US$660-million crypto loan the troubled hedge fund has not repaid (probably just a misunderstanding of some sort). With its business already reeling amid a collapse in prices of bitcoin and other cryptocurrencies, Voyager said it has secured cash and crypto credit lines from Alameda Ventures Ltd. to “meet customer liquidity needs during this dynamic period.” Yes, very “dynamic” times indeed.
Revlon (STAR)
REV - NYSE
You’ve heard the expressions “putting lipstick on a pig” and “if pigs could fly”? Well, meet the new “flying lipstick pig”: cosmetics giant Revlon. Burdened by US$3.3-billion of long-term debt and facing supply-chain disruptions and rising costs, the company filed for Chapter 11 bankruptcy protection on June 16 with the goal of reorganizing its capital structure. But instead of falling, the stock has been surging ever since, propelled by speculators trying to make a quick buck by driving the share price higher. “Oink, oink, you look wonderful, darling!”
Weber (STAR)
WEBR - NYSE
Business quiz! Shares of outdoor grill maker Weber rose after: a) Ford unveiled the new “F-150 Barbecue Edition” pickup, with a built-in Weber grill for tailgate parties; b) McDonald’s announced it will be replacing all of its human burger flippers with “next-generation Weber grills that use artificial intelligence and machine learning to cook burgers to perfection every time”; c) traders on Reddit’s WallStreetBets forum touted Weber’s heavily shorted stock, triggering a short squeeze that drove the price higher as bearish investors bought shares to cover their positions. Answer: c.
Carnival (STAR)
CCL - NYSE
It’s been said that a rising tide lifts all boats – and that was certainly the case for cruise line stocks this week. Shares of Carnival, Royal Caribbean Cruises and Norwegian Cruise Line Holdings all jumped after Carnival, the world’s biggest cruise operator, said booking volumes during the quarter ended May 31 nearly doubled from the previous quarter and were the highest since the pandemic began. With more than 90 per cent of Carnival’s fleet now in service and the company generating positive cash flow from operations during the quarter, investors are enjoying a bon voyage.
A humorous look at the companies that caught our eye, for better or worse, this week
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John Heinzl