Author: therawinformant

Yahoo Finance’s Brian Sozzi and Alexis Christoforous discuss with Wedbush’s Tesla upgrade with analyst Dan Ives.

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Here's why Tesla's stock continues to be on fire.

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(Bloomberg) — Colin Huang’s ascent is one for the history books: In just six months, his fortune swelled by $25 billion — one of the biggest gains among the world’s richest people.His Pinduoduo Inc., a Groupon-like shopping app he founded in 2015, has become China’s third-largest e-commerce platform, with a market value of more than $100 billion. In the first quarter, as the coronavirus pandemic caused most of the nation’s economy to grind to a halt, PDD’s active users surged 68% and revenue jumped 44%, the company said in May.Now Huang, who has overseen the firm as its American depositary receipts have more than quadrupled in less than two years, has stepped down as chief executive officer.At one point, his net worth climbed as high as $45 billion, placing him just behind China’s wealthiest people — Tencent Holdings Ltd.’s Pony Ma and Alibaba Group Holding Ltd.’s Jack Ma — on the Bloomberg Billionaires Index. That’s even as PDD continued to post losses, primarily because it chases growth with the help of generous subsidies and has been known to spend more on marketing than it earns in sales.“Pinduoduo was perfectly positioned for people being stuck at home,” said Tom Ronk, CEO of Century Pacific Investments in Newport, California.Huang, who controlled 43.3% of PDD shares, has reduced his stake to 29.4%, according to a June 30 regulatory filing. His fortune now stands at $30 billion.That excludes a $2.4 billion charitable holding that he shares with PDD’s founding team, and $7.9 billion that went to Pinduoduo Partnership, of which Huang and newly named CEO Lei Chen are members. The partnership will help fund science research and management incentives, according to a letter following Huang’s resignation. The wealth estimate also excludes $3.9 billion that people familiar with the matter said was transferred to an angel investor.PDD declined to comment on Huang’s holdings or net worth.Facing ChallengesHe will remain chairman and work on the company’s long-term strategy and corporate structure to help drive the future of the e-commerce giant, PDD said.“PDD is still facing some high-level challenges in product supply, relationship with brand merchants, logistics and payments,” said Shawn Yang, an analyst at Blue Lotus Capital Advisors. “Colin may want to focus more on these issues.”PDD’s success hinges on deals, which have become particularly popular with customers looking for bargains as the world’s second-largest economy slows. Most of its users come from smaller Chinese cities, and the app gives them extra discounts when they recommend a product through social networks and get friends to buy the same item.Fen Liu, a homemaker in Chenzhou, a provincial city in south Hunan, said she accrued enough coupons with her friends’ help to reduce the price of a suitcase to zero.“I couldn’t believe my eyes when I saw my suitcase arrive in the mail,” she said. “It’s made me a loyal Pinduoduo user ever since.”‘Bargain Hunters’While PDD’s aggressive price-reduction strategies have helped win over people with lower incomes, they may stifle the company’s efforts to attract wealthier consumers, according to Charlie Chen and Veronica Shen, analysts at China Renaissance Securities in Hong Kong.“PDD’s users are largely bargain hunters reluctant to buy large-ticket items,” they wrote in a June 29 note, adding that the company’s image remains a key obstacle to users spending more. “We believe PDD is working to change its low-price brand image — but this could be costly.”That may require heavy marketing and hurt margins further despite a strong user-base foundation for future growth, the analysts said. And PDD’s management has offered no clear path to profitability.Last year, the company’s “10 Billion RMB Subsidies” campaign, which is ongoing, led to a $2 billion increase in sales and marketing expenses to $3.9 billion, and those costs have been at 90% to 120% of revenue for the past two quarters, China Renaissance said.For the nation’s June 18 shopping festival, PDD provided a subsidy program with no cap across different product categories to push spending and attract more users. Other fast-growing Chinese startups — including rival Meituan Dianping, ride-hailing app DiDi Chuxing and Starbucks Corp. competitor Luckin Coffee Inc. — have also adopted subsidies strategies to maintain customer loyalty.Huang, 40, grew up in the eastern city of Hangzhou, where Alibaba has its headquarters. After receiving a degree at Zhejiang University, he went to the University of Wisconsin for a master’s in computer science. He began his career at Google in 2004 as a software engineer and returned to China in 2006 to help establish its operations in the country.He then became a serial entrepreneur. He started his first company in 2007, an e-commerce website called Ouku.com that he sold three years later after realizing it was too similar to thousands of others. He then launched Leqi, which helped companies market their services on websites like Alibaba’s Taobao or JD.com Inc., and a gaming firm that let users play on Tencent’s messaging app WeChat. Both took off and Huang found himself “financially free,” according to a 2017 interview.After getting an ear infection, he decided to retire in 2013 at age 33. But following a year of pondering what to do with his life — he contemplated starting a hedge fund and moving to the U.S. — he came up with the idea of combining e-commerce and social media. At the time, Alibaba dominated the online business, and WeChat became a must-have application on smartphones in China.The tables have turned since. In 2018, Alibaba launched a PDD-style app in an attempt to lure smaller-town users with bargains. It came months before Huang took his company public in New York, raising $1.63 billion in its July 2018 initial public offering. Since then, PDD has surged 350%, while Alibaba has gained just 9.1%.In 2017, Huang had said he was unlikely to spend the rest of his life at PDD. While he’s still chairman of the company, he now wants to give more responsibility to younger colleagues to keep the entrepreneurial spirit as PDD matures, he wrote in a letter to employees.“We envision Pinduoduo to be an organization that creates value for the public rather than being a showoff trophy for a few or carry too much personal color,” Huang said. “This will allow Pinduoduo to continually evolve with or without us one day.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

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Chinese e-commerce giant Alibaba Group Holding Ltd has fired Zhao Yan, the head of its fast-growing livestreaming division, on grounds of nepotism and accepting gifts, according to an internal memo announcing his termination, seen by Reuters. The undated document, produced by Alibaba’s human resources department and published on June 29 on the company’s internal intranet for staff, says Zhao was fired after he used his position to help third-party livestreamers score favourable positioning on Taobao Live, Alibaba’s main platform for live-streamed e-commerce.

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No pain, no gain goes the well-worn axiom. A stock market themed inverse can read: no gain, shareholder pain. You can currently apply the latter to Intercept Pharmaceuticals (ICPT). The small-cap biotech was hoping to gain the FDA’s nod of approval for its liver disease therapy, but there was only pain to endure, as the NDA was rejected. As a result, shares were sent tumbling by 40% on Monday June 29. So, what happened exactly? ICPT received a CRL from the FDA regarding its obeticholic acid (OCA) treatment in advanced-stage non-alcoholic steatohepatitis (NASH), due to a lack of evidence showing that the benefits of the treatment outweigh the potential risks. The FDA recommended that data from the ongoing Phase 3 REGENERATE study be further analyzed. NASH is a fatty liver disease, closely related to obesity, for which there are currently no specific drugs available. Due to the rising obesity rates, the market for NASH medications is expected to grow considerably over the next few years, with some estimates putting its worth at $35 billion. Intercept’s application was based on data from the treatment of over 1,700 NASH patients across 35 clinical trials. Management expects to schedule a meeting with the FDA in 2H20 to discuss how to move forward. Needham analyst Alan Carr expects the NDA to be resubmitted before the end of the year, and anticipates “the drug will be approved in the U.S. by mid-2021.” The analyst believes the rejection might have more to do with the current macro climate than with the data itself. Carr said, “We acknowledge the FDA clearly has some level of concern w/ OCA, however, we believe COVID-19 has played a role in disrupting and preventing completion of the review process. We await the outcome of the meeting with the FDA and assume resubmission by YE20. We still believe OCA will be approved in NASH, but have reduced our target due to launch delay.” That price target is slashed from $150 to $100, although the figure still implies hefty upside potential of 115%. Carr made no change to the rating, which remains a Buy. (To watch Carr’s track record, click here) Looking at the consensus breakdown, based on 6 Buys and 15 Holds, ICPT has a Moderate Buy consensus rating. With an average price target of $66.10, the analysts forecast possible upside of 42% over the next 12 months. (See Intercept price targets and analyst ratings on TipRanks)

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(Bloomberg) — A London judge delivered a blow to Venezuelan President Nicolas Maduro’s attempt to retrieve $1 billion of gold in Bank of England vaults, ruling that opposition leader Juan Guaido should be recognized as the country’s interim president.In deciding the ownership of the gold, the court should accept the U.K. government’s “unequivocal” recognition of Guaido, Judge Nigel Teare said Thursday. The decision dismisses the attempt by Maduro-appointed executives at Venezuela’s central bank to set aside the comments.The bank sued the BOE to get the gold that it says is urgently needed in a joint effort with the United Nations Development Fund to fight the Covid-19 pandemic. The bullion has been in limbo since U.S. officials successfully lobbied their British counterparts last year to block Maduro from withdrawing the gold.The U.K. government last year said it recognizes Guaido as Venezuela’s interim president until new, credible elections can be held.“Today’s decision recognizes the legality of our interim government as we transition into democracy,” Guaido-appointed Attorney General Enrique Sanchez Falcon said in a phone interview. “It also establishes a criteria that will surely impact other ongoing trials.”Sanchez, who called the judge’s ruling a “triumph,” said the opposition planned to safeguard the gold for the time being, as part of Guaido’s efforts to secure Venezuela’s financial assets abroad.The Venezuelan bank said it planned to seek permission to appeal. A representative for the Bank of England declined to comment.The judgment “entirely ignores the reality of the situation on the ground,” Sarosh Zaiwalla, a lawyer for the bank, said. “This outcome will now delay matters further, to the detriment of the Venezuelan people whose lives are at risk.”(Updates with comments from Guaido’s prosecutor starting in the fifth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

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Celebrations may be in order for OncoCyte Corporation (NYSEMKT:OCX) shareholders, with the analysts delivering a…

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Food delivery service Postmates will file for an IPO as soon as next week. Yahoo Finance’s On The Move panel discusses.

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The latest 13F reporting period has come and gone, and Insider Monkey have plowed through 821 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds' and investors' portfolio positions as of March 31st, a week after the market trough. Now, we are […]

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