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Market Morning: Paddy & Stars Flutter Together, Tesla Falls Short, Bed Bath & Beyond Closures

ME Staff

Paddy Power AKA Flutter, The Stars Group, Merge

The European gambling scene continues to merge into itself in preparation for the expansion of the US sports betting market. Paddy Power, which only recently merged with Betfair and changed its name from Paddy Power Beftair to Flutter (OTCMKTS:PDYPY), and The Stars Group (NASDAQ:TSG), formerly Amaya, which acquired a whole bunch of companies over the past few years including Poker Stars, will be merging, creating the largest online gambling company in the world. Both companies’ stocks shot up yesterday on the news, indicating that market participants agree that the merger is a good idea. It is unclear what the name of the new firm will be. Stellar Flutter, or Fluttery Stars are possibilities. No cash will be transferred in the deal, as it is 100% share-based. Flutter shareholders will own about 55% of the combined entity, with TSG shareholders owning 45% and change.

SEE: Yield Growth Gets European Approval for Five CBD Beauty Products

The Trade War in Spain Stays Mainly On the Wine and Cheese Plain, With Olives

The Trump Administration is moving the Trade War to Spain. According to Reuters, United States tariffs on the European Union would affect about $1.1 billion of Spanish exports consisting mostly of agricultural products, every year. The US is the biggest export market for Spain outside of other EU countries, and wine, oil, cheese and olives are the products likely to be affected the most. So if you want to avoid the tariffs, conduct all your wine and cheese parties now, or buy wine and cheese in bulk and build your own cellars. Complaining about the wine and cheese problem, paraphrasing every 5-year old with a very sophisticated palette and high acquired tastes, Spanish Agricultural Association head Miguel Blanco called this “totally unfair”.

“It is totally unfair and disproportionate that the rural community has to pay for a trade war with the European Union that has nothing to do with the Spanish countryside.” Trade wars aren’t exactly fair, true, but they are what they are.

Tesla Meets Delivery Expectations By Falling Short of 6-Figure Goal

Tesla (NASDAQ:TSLA) missed its Elon Musk-imposed delivery goals for the quarter once again, though not by too much. The company delivered 97,000 cars last quarter, just 500 short of Wall Street expectations, though 3,000 short of Musk expectations. The deliveries were still the most the company has made in a quarter, just edging out the 95,200 it delivered last quarter. Musk said that the challenge is having the right cars in the right places. “The challenge is making sure that we have the right car variants in the right locations and rallying as much as our company resources as possible to help with the end of the quarter deliveries,” he said. In terms of profitability, Wall Street analysts are still expecting a third quarter loss despite the record deliveries. Shares are down to $230 in the premarket, though still $50 above long term support at around $180. Earnings are scheduled for later this month.

Bed Bath & Beyond Goes Beyond In Store Closures

Bed Bath & Beyond (NASDAQ:BBBY) is collapsing in premarket trading as the company has announced that it will increase the number of stores it will close this fiscal year. The expected number is now 60, 33% more than the 40 it originally estimated it would close. The closings will take place after the holiday shopping season. 40 of the stores will be branded Bed Bath & Beyond stores and 20 will be other concepts owned by the company. There are currently 993 Bed Bath & Beyond stores in the US, and 541 other concept stores.  The closures are not unique to BB&B, but have come across the retail sector with 8,600 closures this year up from 5,900 in 2018.

Nabis Enters California Cannabis Market

Nabis Holdings (OTCMKTS:NABIF) has gotten a foothold in the California cannabis market with its acquisition of Desert’s Finest dispensary near Palm Springs for $5.6 million. The dispensary had annual sales above that purchase price at $5.7 million in 2018 with a gross profit margin of 47%. The company has also appointed a new Chief Financial Officer and has made two other acquisitions this year, one in Arizona and another in Washington State. “We are pleased to report a strong balance sheet with a cash balance that will fund us through our previously announced acquisitions. As we focus on driving our business forward, yesterday we announced a strategic new hire to strengthen our management team,” said the firm’s CEO, Shay Shnet, in an update to shareholders.

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