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Diamondback (FANG), Endeavor Energy to merge. (00:22) V.F. Corp (VFC) founding family supports activist Engaged Capital in board fight – report. (01:18) Tesla (TSLA) temporarily cuts some U.S. auto prices. (02:44)
This is an abridged transcript of the podcast.
Diamondback Energy (NASDAQ:FANG) and Endeavor Energy Resources have agreed to combine and create a company valued at more than $50 billion.
The deal was announced on Diamondback’s website today. It was reported in a WSJ report on Sunday, which cited people familiar with the matter, that Diamondback (FANG) may announce a deal as soon as today.
The memo says the stock-and-cash transaction would value Endeavor at approximately $26 billion. Diamondback has a market cap of about $27 billion.
Diamondback (FANG) took on competition from ConocoPhillips (COP) and others in its quest to buy Endeavor, according to the report.
An Endeavor/Diamondback (FANG) deal follows a flurry of M&A activity in the Permian Basin, including Occidental’s (OXY) announced $12 billion purchase of CrownRock in December and Exxon Mobil’s (XOM) planned $59.5 billion acquisition of Pioneer Natural Resources, which was announced in October.
Engaged Capital has won the support of V.F. Corp.’s (NYSE:VFC) founding family in its battle with the owner of brands such as North Face, Vans, and Timberland.
Engaged Capital, which has a 1.3% stake in VF (VFC), has won the support of descendants of John Barbey, who founded VF in 1899, according to a Reuters report on Sunday, which cited Kelly Barbey. The Barbey family members now collectively own about 15% of VF.
The Barbey family wants two directors on VF’s 12-member board replaced, Kelly Barbey told Reuters. The family wants Clarence Otis, a director since 2004, and Juliana Chugg, a director since 2009, removed.
Engaged Capital has identified people with retail sector and turnaround expertise to serve as director candidates, according to Reuters, which cited sources familiar with the matter. The deadline to nominate directors is on Tuesday.
The news comes after Engaged Capital first disclosed a stake in the apparel and footwear company in October. Engaged believes V.F. Corp (VFC) can realize a mid-$40 share price within three years, according to a copy of a presentation presented at an activist investor conference.
Engaged is looking for VFC to make operational improvements, including cutting costs that may be worth more than $300 million a year. The activist also wants the company to conduct a strategic review of its non-core assets and real estate and possibly look to refresh its board. Some brands VFC could look to unload include Timberland, Dickies, Supreme, and Smartwool.
Activist Legion Partners also has a stake in VF Corp. (VFC) and wants the company to divest brands such as Timberland.
Tesla (NASDAQ:TSLA) is temporarily cutting U.S. prices of some of its Model Ys.
Prices will be reduced until Feb. 29, with the Model Y rear-wheel drive down $1,000 to $42,990 and the Model Y Long Range down $1,000 to $47,990.
The bulletin at the top of Tesla’s website also says that prices will increase by $1,000 or more on March 1.
Other articles to look out for on Seeking Alpha:
Earnings week ahead: Coca-Cola, Cisco, Shopify, Roku, Biogen and more
The price of chocolate may be hard to swallow this Valentine’s Day
Tesla trades lower than it did a year ago – reality check or buying opportunity?
Avis Budget (NASDAQ:CAR) is on our earnings watch for the day. CAR is scheduled to announce Q4 earnings results today after market close.
The consensus EPS Estimate is $4.12 (-60.6% Y/Y) and the consensus Revenue Estimate is $2.81B (+1.4% Y/Y).
Over the last 2 years, CAR has beaten EPS estimates 100% of the time and has beaten revenue estimates 100% of the time.
On our catalyst watch for the day,
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SeaWorld Entertainment (SEAS) will formally change its corporate name to United Parks & Resorts Inc. The stock symbol will change to PRKS.
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Microsoft (MSFT) is expected to hold a business update event covering the future of Xbox.
U.S. stocks on Friday ended largely to the topside, helped by a rise in megacap technology stocks. Wall Street’s benchmark S&P 500 (SP500) concluded above the historic 5,000 points mark for the first time ever.
The Nasdaq (COMP.IND) advanced 1.25%. The S&P (SP500) added 0.57%.
The Dow (DJI) slipped 0.14%.
Of the 11 S&P sectors, eight ended in the green, led by Tech. Energy, Consumer Staples and Health Care were the three losers.
Now let’s take a look at the markets as of 6 am. Ahead of the opening bell today, Dow, S&P and Nasdaq futures are mixed. The Dow is up 0.1%, the S & P 500 is up 0.01% and the Nasdaq is up 0.02%. Crude oil is down 0.8% at more than $76 per barrel. Bitcoin is down 1.2% at more than $47,000.
In the world markets, the FTSE 100 is up 0.02% and the DAX is up 0.4%.
The biggest movers for the day premarket: Applied Digital (NASDAQ:APLD) is down 4.6% following the company’s announcement of a power outage that began on January 18, 2024, and escalated to a complete outage by January 19, impacting its revenue from its Ellendale data center hosting facility in the quarter ending February 29.
On today’s economic calendar:
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