UPS outlook, Moody's bank downgrades, Eli Lilly raises guidance: 3 Things
Delivery company UPS posts a second-quarter earnings miss, slashing its guidance and full-year forecast. Moody's has downgraded ten small and medium-sized U.S. banks, including M&T (MTB), Pinnacle (PNFP), Webster Financial (WBS), and issued negative outlook warnings on larger financial bodies like PNC, Capital One (COF), and Citizen's Bank (CFG). Lastly, pharmaceutical developer Eli Lilly (LLY) raises its full-year guidance on the success of its weight-loss and breast cancer drugs. Yahoo Finance Live's Julie Hyman breaks down several of this morning's top headlines.
Video Transcript
JULIE HYMAN: UPS shares slump after the delivery giant missed on second quarter revenue and slashed its full-year outlook. Revenue guidance now at around $93 billion this year. That is down from a prior forecast of roughly $97 billion. Much of the hit being put down to the impact of labor negotiations.
The UPS and the Teamsters Union reached a tentative deal on a new contract at the end of July. Union members are yet to approve it, however. These results won't come as a huge shock to investors. At the end of April, UPS warned that volume would remain under pressure due to current macro conditions.
Moody's has cut its rating on 10 small and mid-sized US banks and warned it could downgrade bigger lenders as well. There were official downgrades for the likes of M&T Bank, Pinnacle, Webster Financial. 11 banks in total were put on a negative outlook including larger lenders like PNC, Capital One and, Citizen's. Those are all falling in premarket trading. Bigger plays like Bank of New York Mellon, US Bancorp, and State Street are all under review for a potential downgrade.
And the good times keep rolling for Eli Lilly. Thanks to a strong drug pipeline, the pharma company upping its full-year guidance after second quarter profit rocketed 85% from a year ago. It now sees full-year revenue landing between $33.4 billion and $33.9 billion, much of the tailwind coming from its type 2 diabetes drug Mounjaro which, of course, is also being used off-label for weight reduction and breast cancer pill Verzenio. Shares were up 25% this year, and they've outperformed the wider sector.
