MGM Macau’s woes spilled over to Hong Kong – Breakingviews



– Macau casinos

– The peloton’s gains

– Moderna

Risk. Two executives from Hong Kong-based Snow Lake Capital quit amid bad bets including Chinese stocks, Financial Times says reported, forcing him to liquidate a fund and withdraw. The turmoil highlights the hedge fund’s dire position in MGM China.

In January, Snow Lake disclosed a 7.5% stake and asked the casino company to sell a fifth of its then-listed Hong Kong-listed unit, worth $ 6 billion, to a Chinese investor, before being rejected. An increase in local ownership could have played well as casino companies prepare to re-bid for their local license in 2022. Regulators have already launched a consultation.

US operators have underperformed their local competitors so far this year. Wynn Macau and Sands China lost about half of their value. MGM shares have plunged by about two-thirds over the same period.

Snow Lake’s risky idea introduced new risks and would have meant sacrificing the parent company’s controlling stake or diluting minority investors. The stakes are getting higher for both parties. (By Katrina Hamlin)

Short of breath. People go to the gym again. This is the message of the first quarter of Peloton Interactive earnings Thursday night. Investors wiped out nearly 30% of the company’s market value in after-hours trading after chief executive John Foley said the company underestimated the effect post-pandemic life would have. on its activities. As with the cardio workouts, Peloton went too hard.

Subscriptions nearly doubled from the same quarter last year, but revenue grew only 6% and fell almost 14% between the three months and June, to $ 805 million. A treadmill recall didn’t help, but other mediocre metrics including rising marketing spend reversed Peloton in an adjusted EBITDA loss of $ 234 million.

Revenue was still 73% higher than in the quarter that ended at the start of the pandemic, and its share price has quadrupled since then. Peloton, however, now has two issues slowing it down: Covid-19 has ramped up demand, and toned bodies now have a place to show off. Staying in financial shape will require new exercises. (By Lauren Silva Laughlin)

Feel the pinch. Moderna shares collapsed nearly 20% on Thursday, costing it $ 25 billion in market capitalization, after reduce sales forecasts for this year at $ 15-18 billion against $ 20 billion previously. It is a reminder both of the success of the company of the boss Stéphane Bancel and of its challenges.

The difficulties of accelerating production and distribution have brought expectations to zero. Much of the missing top line may reappear in 2022. Moderna’s rapid rollout of its messenger RNA vaccine has been spectacular, but it did not start with the scale or experience of rival jab maker Pfizer and therefore lags behind in areas ranging from progression from approval to production volume.

The stock has consistently posted a gain of 14 times since the end of 2019, even after Thursday’s drop. Moderna has other therapies to come, but her addiction for now on Covid injections is making it volatile. Of the 17 analysts identified by Refinitiv, eight recommend buying and four selling, with price targets ranging from a third of the current level to almost double. With this kind of range, it’s up to everyone to guess. (By Richard Beales)

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