U.S. Stock Market Recap for 12 May 2020: Apple, Disney, Gilead, Tesla

Siamak Masnavi
  • 12 May 2020

This article provides a recap of the action in the U.S. stock market on 12 May 2020, with a focus on news related to Apple, Disney, Gilead, and Tesla.

Major U.S. Indexes

  • The Dow: Down 457.21 points (or 1.89%) to 23,764.78
  • The S&P 500: Down 60.20 (or 2.05%) to 2870.12
  • The Nasdaq: Down 189.79 (or 2.06%) to 9002.55

Apple Inc. (NASDAQ: AAPL)

Google Finance Chart for AAPL on 12 May 2020.png

Investor's Business Daily reported today that Wedbush Securities analyst Daniel Ives has raised his 12-month price target on Apple stock to from $335 to $350 and reiterated his "Outperform" rating.

Ives said in a note to clients:

"The investment thesis on Apple for fiscal 2021 and beyond has remained on course although some darker days are still ahead with the global lockdown and dismal economic backdrop...

"With (Apple) stores opening up to strong demand throughout Asia and a handful of U.S. stores opening up this week, coupled by a recovering supply chain which is on the path to normalization, it appears Apple is starting to lay the early groundwork for the next chapter of growth."

UBS analyst Timothy Arcuri has reiterated his "Buy" rating on Apple stock with a price target of $325, saying in a note to clients:

"Though initial view that spend on Apple products is more discretionary and could be impacted in a downturn is somewhat valid, we believe there is pent-up demand as purchase intent has improved and consumers have more discretionary spend available (fewer vacations, dining out, etc.)."

Walt Disney Co (NYSE: DIS)

Google Finance Chart for DIS on 12 May 2020.png

TheStreet reported today that although Disney’s U.S. theme parks have been closed since mid-March, the company is currently accepting reservations for Walt Disney World theme parks and Disney Resort hotels in Orlando starting from July 1.

Last week, MoffettNathanson analyst Michael Nathanson downgraded Disney stock from "Buy" to "Neutral", and offered this note via an explanation:

“For more than a decade, we have been stalwart believers in the factors that make Disney different than the rest of the media pack...

“The company’s leadership, strategic positioning, asset mix and brand equity have consistently delivered for their investors... 

"We are downgrading Disney not because we have lost faith in those attributes, but rather because we believe there are a number of risks that could lead this unprecedented event to have a longer impact.”

Gilead Sciences (NASDAQ: GILD)

Google Finance Chart for GILD on 12 May 2020.png

CNBC reported today that Gilead Sciences has announced that it has "struck a licensing agreement with five generic drugmakers to make antiviral drug remdesivir in 127 countries, not including the United States."

The five -- drug manufacturers are Mylan, Cipla, Ferozsons Laboratories, Hetero Labs, and Jubilant Lifesciences -- will manufacture remdesivir for distribution in 127 countries.

CNBC says that this deal is royalty-free until the World Health Organization (WHO) confirms that COVID-19 is no longer a global health crisis or “until a pharmaceutical product other than remdesivir or a vaccine is approved to treat or prevent Covid-19, whichever is earlier."

Tesla (NASDAQ: TSLA)

Google Finance Chart for TSLA on 12 May 2020.png

CNBC reported that some Tesla employees at the company's car plant in Fremont, California, returned to work as early as Sunday (May 10), and that "Models 3, Y, S and X were all being produced" at this factory today. 

CNBC says that "Musk personally thanked those who did return to work in an e-mail sent earlier today:

"An honest day’s work spent building products or providing services of use to others is extremely honorable.

"I have vastly more respect for someone who takes pride in doing a good job, whatever the profession, than some rich or famous person who does nothing useful.”

During an appearance on CNBC's "Squawk on the Street", Jim Cramer, the host of CNBC's "Mad Money" said that although Tesla CEO Elon Musk is a "zealot", he agreed with Musk's decision to restart production at the Fremont factory in violation of health orders from Alameda County (where the city of Fremont is located).

Shortly afterwards, U.S. President Donald Trump tweeted:

 

Featured Image by "272447-272447" via Pixabay.com