đŠ Elon threatens to walk
Hey Snackers,
The only thing worse than forgetting your phone in a post-brunch cab: losing 500 grams of caviar. Uber's annual lost-and-found index includes everything from a bucket of slime to a pizza costume and tater tots.
Stocks started the week slowly with all three major indexes narrowly closing the day higher as investors drank in Mayâs strong jobs numbers. Meanwhile, bitcoin continued to rebound after breaking its longest weekly losing streak on Friday.
Elonâs threatening to ditch his Twitter deal: it might be about buyerâs remorse, not bots
Well, this is awkward⊠Elonâs stint as Twitterâs new would-be owner could end before it begins. The Technokingâs threatening to back out of his $44B deal to buy the social-media company if it doesnât give him more detailed data about how many of its users are bots. But Twitterâs standing pat, saying it plans to âenforceâ the merger as is.
- Still on hold: Last month Elon said the (legally binding) deal is on âholdâ until Twitter proves its claim that fewer than 5% of daily users are bots.
- Thwarts and all: In yesterdayâs letter to the SEC, Elonâs lawyers said Twitter broke the deal first by âthwartingâ Elonâs right to info, which they say gives him the right to bail.
Bots are getting all the blame⊠but theyâre just part of the story. Twitter really does have a bot problem: experts estimate 10% of users are fake. But Elon has another big reason to back out of the deal: the price.
- Clipped wings: Twitterâs stock has fallen 23% since the takeover was signed, which means Elonâs on the hook for $14B more than the companyâs current market value. Analysts suspect his real goal is to pressure Twitter into renegotiating at a lower price.
The law is on Twitterâs side⊠but time may be on Elon's side, if heâs willing to sit through a lawsuit. M&A experts say Elon has little legal ground to stand on, since he waived his right to inspect Twitterâs finances and signed a contract that forces him to follow through. Yet if Elon takes it to court, Twitter could get stuck in a pricey, drawn-out lawsuit that scares off employees, users, and investors. Twitter might decide to sell at a discount to avoid a legal battle with the worldâs richest meme-lord.
Biden moves to boost solar-panel production during an industry slowdown, but the outlook for his larger clean-energy plan isnât sunny
Hit âem with a DPA... President Biden is shining light on the solar industry with his latest executive actions. The White House has authorized the Defense Production Act to rev up US manufacturing of solar panels and other clean-energy components. Refresher: the DPA lets presidents order companies to produce critical things in short supply (think: masks, baby formula). In this case, itâs energy: oil and gas supplies have been strained since Russia's invasion of Ukraine, so boosting renewables might help.
- The White House also announced a two-year suspension of tariffs on solar panels imported from Cambodia, Malaysia, Thailand, and Vietnam â which together supply ~80% of America's solar products.
- Why those tariffs were sweat-inducing: An ongoing federal investigation into whether those countries are using materials from China has stalled much of the US solar industry, which is worried about having to pay hefty retroactive tariffs. Hundreds of US solar projects have been scrapped since the probe began in March.
Just add "sun"... Solar stocks like Sunrun, SunPower, SolarEdge, and Enphase Energy spiked yesterday as investors welcomed the tariff suspension, which the solar industry had been lobbying for. But not everyoneâs thrilled: US manufacturer First Solar and others that weren't directly threatened by the investigation said the suspension was a loss for American manufacturing. First Solar sank 4%.
Solar needs an energy injection⊠After Biden got elected, there was optimism that the Dems would incentivize federal and private solar spending. That sunny vision died last year when Bidenâs Build Back Better bill, which featured $500B+ in climate-related spending, stalled in Congress. Fewer than 5% of US homes use solar energy, and installation prices have risen as trade policies caused uncertainty and supply constraints. Cutting tariffs is a roundabout way to revive renewables.
What else weâre Snackinâ
- iOS: Apple unveiled software updates for the iPhone, iPad, Watch, and Mac at its annual developer conference, plus a pair of new laptops. Not mentioned: any updates on its long-awaited mixed-reality headset.
- Slice: Amazon shares spiked 4% on the first trading day after its 20-for-1 stock split. The Zon got shareholder approval to split shares back in March to make the stock more accessible for retail traders.
- Woo: JetBlue sweetened its takeover bid for Spirit by adding $150M to the breakup fee, plus a cash dividend. Spirit shareholders will weigh in on the original takeover bid from Frontier at a meeting this Friday.
- Scuffle: StockX is fighting back against a Nike lawsuit that accused the online marketplace of selling counterfeit sneaks. StockX says it spends millions to authenticate the kicks sold on its platform.
- Hope: A small cancer-drug trial reported âunheard ofâ results after all 18 patients went into total remission. They suffered from a rare form of rectal cancer that was treated with a new therapy from GlaxoSmithKline.
Tuesday
- California primary election. Earnings expected from JM Smucker, Smartsheet, Dave and Busterâs Entertainment, and Cracker Barrel
Authors of this Snacks own: bitcoin and shares of Apple, Amazon, Twitter, and Uber
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