Disney's Proxy Battle Returns
And, PagerDuty's private placement.
Today is Tuesday, October 10, 2023.
The Early Bird Index today is 53.57.
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Disney's Proxy Battle Returns
Shares of Walt Disney (NYSE: DIS) ticked up 2.12% on Monday after it was revealed that the company is facing a proxy battle with an activist investor.
Details: Nelson Peltz of Trian Fund Management increased his stake in Disney from about 6 million shares to 30 million shares, and is aiming for a board set.
Definition: A proxy fight is a battle for board seats from activist investors who own a lot of stock in the company. An activist investor buys all those shares to force changes in the company.
Background: Peltz originally organized a proxy fight against Disney late last year, but then backed down. Now, he wants board seats to change the direction of the company.
Also: It appears that Disney was “caught by surprise," by the renewed proxy fight, according to Yahoo! Finance.
Stock Price: Disney is down 4% in 2023, but the stock is up 2% this month.
Final Thoughts: The proxy fight from Peltz could push Disney to make more profitable changes, which would benefit investors.
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Notable Earnings Today: PepsiCo (Nasdaq: PEP), AZZ (NYSE: AZZ), Neogen (Nasdaq: NEOG), E2open (NYSE: ETWO).
Notable IPOs Today: Primech Holdings Ltd. Ordinary Shares (Nasdaq: PMEC), La Rosa Holdings Corp. Common Stock (Nasdaq: LRHC).
Notable Equity Crowdfunding Campaigns Ending Today: Ollin Cafetzin (Honeycomb), Michael Waltrip Brewing Company (StartEngine).
Notable Economic Events Today: N/A.
PagerDuty's Private Placement
Cloud computing company PagerDuty (NYSE: PD) plunged by 5.63% in after-hours trading on Monday after announcing a private placement.
Details: PagerDuty is offering $350 million in the form of convertible senior notes that are due in 2028. The offer, which is for qualified institutional buyers, includes an option for buyers to get an additional $52.5 million in notes.
Also: The proceeds will be used by the company to pay the cost of capped call transactions and to repurchase previous notes that were due in 2025.
Stock Price: PagerDuty is down 15% this year, including an 8% decline in the last 30 days.
Background: It’s rare to find a cloud company that is down by double digits this year. Despite recently posting better-than-expected financial results, PagerDuty is struggling to please investors.
Final Thoughts: Investors have been concerned about PagerDuty’s stock valuation for some time. This new private placement worries investors because it shows that the company needs more cash.
Avalanche Drops Due to Hack
The cryptocurrency Avalanche dropped about 4% on Monday due to a recent hack.
Details: A few days ago, hackers drained $3 million worth of Avalanche tokens from the upstar Stars Arena, according to CoinDesk.
Final Thoughts: Avalanche is now down 8% for the year. Most crypto prices are up this year, so Avalanche is a terrible outlier for 2023.
Trends to Watch
Computer Slump: Global PC Shipments Fall 9% in Quarter Seen as Bottom for Market (Bloomberg)
Leadership Change: Unity CEO John Riccitiello Steps Down After Pricing Blowup (Wired)
Visualized Dive: How Surging Yields Brought the Stock Rally to a Halt, in 8 Charts (The Wall Street Journal)
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