Mid-Morning Look

Wednesday, August 13, 2025

Global stock markets continue to grind higher with the S&P 500 and Nasdaq on track for fresh record highs as money markets suggest a September Fed interest rate cut is in the cards (98% chance probability of cutting). With risk appetite inspired, Wall Street’s so-called fear gauge hits its lowest level this year as the Vix drops below 14.50 after highs of 20 just a few weeks ago. Stock markets have surged on the back of strong tech earnings, easing global trade tensions, less impact from tariffs, and increased rate-cut expectations, along with general upside momentum and any hiccups along the way (weaker jobs data, ISM Services, AMZN guidance) has been met with increased market buying activity. The bullishness extends beyond stocks as crypto assets have surged as well, as Ethereum rises above $4,800 (before paring gains), up 25% this month alone (+40% YTD) and Bitcoin rising to around $122,000. Even Smallcaps have been participating on the increased Fed interest rate cut expectations as the Russell 2000 hits six-month highs, rising 1% after jumping nearly 3% Tuesday. The IPO market is also in full swing, much interest as CoinDesk owner Bullish (ticker symbol BLSH) is expected to debut Wednesday after its IPO raised $1.1 billion, pricing at $37 per share (above the $32-$33 range). No major US economic data today ahead of Producer Price Index (PPI) inflation data tomorrow. On the macro front, European leaders will hold a virtual meeting today with President Trump and Ukraine President Zelenskiy ahead of Trump’s meeting on Friday with Russian President Putin.

• In Aerospace & Defense: Bank America with several changes in the sector as they downgraded CDRE to Underperform from Neutral (tgt to $26 from $38) saying since Q2 report, the firm’s concerns about slow growth and the current M&A environment have not abated. Bofa upgraded VVX to Buy from Neutral (tgt to $65 from $55) sees V2X’s recent contract takeaway as a sign of its ability to win in its core logistics and O&M work. The firm also raised its tgts on HII to $260 from $180 and keeps an Underperform rating on the shares while raises tgt on BWXT to $220 from $155 and keeps a Buy rating on the shares.
• In Government IT Services: CACI was double upgraded to Buy from Sell at Goldman Sachs (PT to $544 from $407) and downgraded PSN to Neutral from Buy within a still cautious Government IT & Services. The firm said CACI is the best positioned company in the Gov IT & services space since the change in the administration, with a strong TTM funded book-to-bill and expanding margins due to its pivot to advanced technologies. Conversely, they downgrade PSN due to the uncertainty surrounding the company’s growth prospects, as the dynamics of its contracts rolling off create an implied acceleration in the core in 2H25 that could be difficult to achieve.
• In Insurance: BRO was downgraded to Equal Weight from Overweight at Wells Fargo as thinks organic should trend below peers in the near-term given the overconcentration to the south / property and prefer other brokers reporting stronger organic growth. Cantor initiated insurance today with Overweight on AJG, AON, MMC, neutral on WTW, RYAN in brokers; OW on HIG, TRV, WRB and Neutral AIG, CB, KNSL in commercial lines and Overweight on LMND, GSHD and Neutral on ALL, PGR, TRUP in Personal lines.
• In Food: AMZN announces major grocery expansion: tens of millions of Prime members can now shop perishable groceries alongside the rest of amazon’s same-day selection with fast, free delivery; said Prime members get free same-day delivery on orders over $25 and non-prime members pay $12.99 fee for same-day delivery (shares of WMT, CART, KR saw weakness on the news). In beverages (SAM, TAP, BUD), Reuters noted alcohol consumption among adults in the U.S. is at the lowest level on record, a survey by analytics firm Gallup showed that about 54% Americans reported drinking alcohol, compared with 58% in 2024 and 62% in 2023.

• ATNF +47%; adding to the more than 200% gain the prior day after Billionaire Peter Thiel revealed a 7.5% stake in ATNF, according to a regulatory filing late Monday. ATNF, an investment vehicle for hoarding crypto token ether, plans to rebrand as ETHZilla, said it has holdings of 82,186 ether, valued at roughly $349 million.
• GBIO +31%; shares jumped after saying they would explore strategic alternatives, including a sale, merger, or asset deal, with TD Cowen advising and announcing a restructuring with about a 90% workforce reduction by end of October (follows weaker Q2 results with sales of $765K missing the $3.1M estimate).
• INTA +11%; shares jumped on results following an across the board beat in F4Q, initial outlook for FY26 that came in ahead of the street on the top/bottom lines, and the initiation of a $150mn share repurchase plan.
• LITE +2%; was upgraded to Neutral from Underperform at Bank America and raised tgt to $135 from $78 after results saying outsized chip and module demand could pull-in 600M/$750M sales targets 2-3 quarters early. As margin accretive components scale, the firm sees an earlier path for GMs to enter the >40% range by C2H’26.
• SPNS +43%; after Private equity firm Advent International has struck an agreement to acquire Sapiens International Corp., an Israeli software provider to the insurance industry, for about $2.5B; Sapiens shareholders will receive $43.50 per share.
• VG +8%; after Tribunal sides with the company in a legal battle against SHEL over cargo delivery from the Calcasieu Pass export facility; Shell had accused VG of favoring spot sales over contract obligations.
• WBTN +71%; shares jump after announced a deal with DIS to bring about 100 series to its English-language app.

• CAVA -17%; shares tumbled on results and guidance as Q2 EPS beat but revs of $280.6M missed the consensus est. $285.6M on weaker same restaurant sales growth 2.1% vs est. growth of 6.47%; also guides FY same store restaurant sales growth 4%-6% vs est. growth of 7.67%.
• CRCL -3%; filed for offering 2M Class A shares; selling stockholders offering 8M Class A shares.
• CRWV -12%; delivered solid Q2 results, beating on revenue ($1.21B vs $1.08B consensus) and adj-OI ($199.8M vs $159.4M), driven by robust compute demand in a continued supply-constrained env’t; though Guidance was mixed with revenue outlook higher-than-consensus for Q3 and FY25, but margin forecasts falling short.
• KLC 25%; shares tumbled after posting disappointing Q2 results citing a softer-than-anticipated enrollment and lowering their outlook for the full year, which prompted a downgrade at Barclays.
• LAZR -18%, INVZ -14%; amid weakness in LiDAR sector after earnings results from both.
• LEU -5%; after files to sell $650M of Convertible Senior Notes due 2032.
• SSYS -11%; after guiding FY revs in the range of $550M-$560M, down from prior outlook of $570M-$585M; also cut its FY adj EPS view to $0.13-$0.16 from $0.30-$0.37 prior and also cuts FY gross margins forecast to 46.7%-47% range from 48.8%-49.2% prior.

• NSRX (Nasus Pharma) 1.25M share IPO, priced at $8.00 (range was $8 – $10)
• ACDC 18.75M share Spot Secondary, priced at $4.00
• CMPX 33.3M share Spot Secondary, priced at $3.00
• CTRE 15.5M share Spot Secondary, priced at $32.00
• CURI 7M share Spot Secondary, priced at $3.50
• HGV 7M share Spot Secondary priced at $43.15
• LODE 13.3M share Spot Secondary, priced at 2.25
• ONDS 46.16M share Spot Secondary priced at $3.25
• SPXC 2.66M share Secondary, priced at $188.00
• TSS 3M share Spot Secondary priced at $17.00