Casey's Says Volatile Fuel Environment Weighed on Margins — Market Talk
1156 ET - Casey's General Stores is navigating a choppy fuel environment as rising oil costs weigh on its profitability. "Volatile is the word I would describe the fuel margins," Chief Financial Officer Steve Bramlage says on a call with analysts. "Depending on the headlines that you read about in the paper and social media, there would be a corresponding move in fuel margin over the next day or two." Margins swung from the 30% range to the 60% range during the latest quarter, Bramlage says. Because of the external factors, it has been impossible to solve the problem over the course of a quarter, he says. Casey's shares slide 15%. ([email protected])1049 ET - French drugmaker Sanofi and U.S. partner Regeneron Pharmaceuticals could extend the U.S. patent on their blockbuster anti-inflammatory drug Dupixent by two years to 2033, RBC Capital Markets analysts write in a research note. RBC sees a 70% chance of this happening and says the move could help Sanofi as it reshapes its portfolio. "Sanofi is navigating a pivotal transition amid near-term challenges," the analysts say. Despite Dupixent's strength, investors want proof of diversified growth and acquisitions seem likely, they add. RBC starts coverage of Sanofi with a sector perform recommendation and a target price of 80 euros. Shares fall 0.9% to 74.05 euros. ([email protected])1049 ET - Bitcoin stays in its recent range between $77,000 to $81,000, with it trading up 0.7% to $79,068. The volume and activity that powered bitcoin in recent weeks appears to have shifted towards altcoins, says analysts with Bitfinex in a note. "Every one of the 29 largest liquid pairs rose between 1-8 September, with a median gain of 10.2% against 1.4% for bitcoin," says the firm. Polkadot is the leading gainer among major cryptocurrencies in that timeframe, having gained 35% in the past week, according to data from CoinGlass. "This reflects a return of risk appetite in the market," says Bitfinex. Ethereum rises 0.6% to $2,498, XRP climbs 0.7% to $1.42, and solana is up 0.4% to $103.47. ([email protected])1026 ET - Meta Platforms has unveiled Muse, a personal AI agent that aims to let people offload tasks such as booking appointments, filling out forms and monitoring home security camera feeds. Muse may mark the beginning of a substantial product cycle for Meta that isn't currently priced into the company's shares, Mizuho analysts say in a research note. The analysts found Muse's user experience to be significantly more consumer-focused than other AI engines, and they expect Muse to be a more serious contender for consumer usage than they had envisioned prior to launch, they write. "The single biggest hurdle for long-term investors, in our discussions, has been proving out the ROI on AI investment, and we believe the Muse app is a significant step in that direction," the analysts write. Meta shares are up 4.5%. ([email protected])1022 ET - New listings of homes for sale rose 2.6% month over month to their highest level in over four years in August, according to Redfin. The surge in fresh supply was driven by San Jose, where listings rose 25.5% year over year, Nashville at 15.8% and Seattle, 13.7%. More homeowners are listing as the mortgage-rate lock-in effect fades, life circumstances prompt moves and sellers adjust to a slower market. The jump in listings is contributing to a widening pool of overall supply. The total number of homes for sale rose 3.9% from a month earlier to its highest level since 2020. Pending home sales were flat from a month earlier. Closed home sales, a more lagging indicator of demand, fell 0.5% to their lowest level in over a year. ([email protected])0958 ET - Chili's owner Brinker International is showing no signs of slowing down. "While the stock's valuation has re-rated and 'caught up' to the company's extraordinary sales and profit improvements over the last three years, we believe valuation remains reasonable," Raymond James says in a note. Analyst Brian Vaccaro raises F1Q comparable sales estimate for Chili's to up 9% ahead of Brinker's analyst day next week, citing third-party traffic data that shows continued strength in visits. That strength, coupled with further simplification and optimization efforts, should benefit Brinker moving forward, the analyst says. Brinker is up 55% year-to-date. ([email protected])0934 ET - Bank of Nova Scotia economist Derek Holt says that, on net, the Trump administration's adjusted tariffs and ban on certain Canadian imports is more like a "face saving" exercise. It's "not substantive in nature and that's a positive," Holt tells clients. His team estimates a net impact for Canada of $1.2 billion, or 0.3% of nominal GDP. Some of the banned imports from Canada amount to "small potatoes," Holt adds, citing $100 million of motorcycles. Canadian dairy products subject to a U.S. ban had minimal sales to America, Holt adds. Forex traders appear in agreement, with the Canadian dollar holding steady versus USD. ([email protected]; @paulvieira)0932 ET - Bancorp investors are fretting that Chime's plans to acquire Stride Bank could spell a major headwind. Chime indicated that it ultimately expects to consolidate its banking activities at Stride, representing a direct risk for Bancorp given its been a key Chime banking partner for years, alongside Stride, Raymond James analysts say in a note. Still, the analysts say the market appears to be overlooking protections included in Chime and Bancorp's contract, as well as opportunities to mitigate some of the pressure or replace Chime with other partners, or more broadly diversify Bancorp's fintech franchise, they say. Bancorp shares slide 20% to $51.60. ([email protected])0931 ET - President Trump's orders to ban certain Canadian imports "could have been much worse," says Wolfgang Alschner, a business-and-trade law professor at the University of Ottawa. "It is clearly more posturing than escalation," he says in a LinkedIn post. Alschner says the ban of certain Canadian imports, effective Sept. 29, is modest, and covers less than 0.25% of Canadian exports. For instance, the U.S. intends to ban Canadian-made mopeds valued at C$81 million. Canadian alcohol accounts for a sizable chunk of the U.S. import ban, but Alschner notes the ban covers only packaged products. Canadian alcohol, like beer, can be sent to the U.S. in bulk and packaged there, he adds. ([email protected]; @paulvieira)0921 ET - Oil futures extend their rally with Brent at $100 a barrel as the escalating conflict in the Persian Gulf feeds concerns about supply out of the Middle East. Increasing strikes by both the U.S. and Iran are raising the war premium and the inflation fear factor, Peter Cardillo of Spartan Capital says in a note. "At the same time, a pickup in Chinese demand is strengthening the fundamental outlook for oil, even as overall supply and demand remain relatively balanced." WTI is up 2.8% at $95.66 a barrel and Brent is 2.7% higher at $100.58 a barrel. ([email protected])0917 ET - Robinhood could be in for a big boost when AI companies like Anthropic and OpenAI go public, Mizuho analysts say in a note. The analysts highlight how SpaceX's IPO in June, and the elevated tech sentiment afterward, drove a roughly 24% month-over-month increase in equity volumes, and helped the company add about 1 million funded customers in 2Q, its biggest quarterly gain in almost five years. "If the post-SpaceX elevated retail trading environment were to repeat itself, the anticipated AI IPOs in October and in 2027 could meaningfully boost HOOD's trading volumes," the analysts say. They now forecast the company's 4Q equity volumes will increase about 50% year-over-year, up from their prior projection for 16% growth.([email protected])0847 ET - Fortum's nuclear power deal with Google could have favorable implications not only for the Nordic energy company's valuation, but also the European data-center buildout story, Citi analyst Piotr Dzieciolowski writes. The deal has a long duration, is material in size, and looks to be priced at a substantial premium to current expected future wholesale prices, he says. Fortum and Google signed a 22-year power purchase agreement for 50% of the Loviisa nuclear power plant's capacity. The agreement will start in 2028 and will reach 50% of the Loviisa power plant's capacity in 2030-49. The volume linked to the deal is above 4 terawatt hours, which is about 9% of Fortum's current portfolio and 5% of Finnish demand, Citi adds. Shares rise 14%. ([email protected])