VLKAF - Wall Street Breakfast Podcast: QuantumScape Soars On Volkswagen Battery Test Success

2024-01-05 06:48:59 ET

Summary

• QuantumScape's battery technology passes important test by Volkswagen, boosting its stock by 43%.
• Costco reports a 9.9% increase in net sales for December, benefiting from an extra sales day.
• McDonald's experiences business impact in the Middle East due to conflict between Israel and Hamas.

Listen below or on the go on Apple Podcasts and Spotify

QuantumScape ( QS ) skyrockets after dazzling with Volkswagen ( VLKAF ) battery test. (00:23) Costco ( COST ) benefits from additional shopping day in December, net sales up 9.9%. (01:32) McDonald's ( MCD ) faces backlash in Middle East impacting business. (02:10)

This is an abridged transcript of the podcast.

QuantumScape Corporation (NYSE: QS ) soared in afternoon trading Thursday after the company reached an important milestone in a test of its battery technology by Volkswagen ( OTCPK:VLKAF ).

In a test confirmed by PowerCo, the battery company of Volkswagen, QuantumScape's ( QS ) solid-state cell significantly exceeded the requirements in the A-sample test and successfully completed more than 1,000 charging cycles.

PowerCo noted that for an electric car with a WLTP range of 500-600 kilometres (311-373 miles) , this corresponds to a total mileage of more than half a million kilometres (~310,000 miles).

Notably, the cell barely aged and still had 95% of its capacity or discharge energy retention at the end of the test.

Looking ahead, the next step on the way to series production is for QuantumScape ( QS ) to perfect and scale the manufacturing processes.

QuantumScape ( QS ) ended the day Thursday up 43%.

The company is expected to report Q4 earnings sometime during the middle part of February.

Costco (NASDAQ: COST ) reported on Thursday net sales of $26.15 billion for the retail month of December, a rise of 9.9% year-over-year.

Total company comparable sales for December rose 8.5%. Excluding the impact of gasoline prices and foreign exchange, total company comparable sales gained 8.1%.

U.S. comparable sales for December rose 7.3%.

According to the retailer, December benefited from one additional shopping day due to the timing of New Year’s Day, boosting total and comparable sales by about three percent.

McDonald's (NYSE: MCD ) finds that it is not immune to the lingering conflict in the Middle East.

In his New Year's message to employees, CEO Chris Kempczinski said that several markets in the Middle East and some outside the region have experienced a "meaningful business impact" due to the conflict between Israel and Hamas, along with associated misinformation about the brand.

Tensions between the hamburger chain and Arab countries were ignited when McDonald's ( MCD ) franchisees in Israel began offering discounts to soldiers in the Israeli Defense Forces.

The action triggered an immediate backlash against the company across the region leading McDonald's Oman to respond with a $100K donation towards relief efforts in Gaza.

On our catalyst watch for the day,

• Zscaler ( ZS ) will host its annual meeting.

On our earnings watch for the day, Constellation Brands (NYSE: STZ ) is scheduled to announce Q3 earnings results today, before the market opens. The consensus EPS Estimate is $3.00 (-0.3% Y/Y) and the consensus Revenue Estimate is $2.54B (+4.1% Y/Y). Over the last 2 years, Constellation Brands has beaten EPS estimates 100% of the time and has beaten revenue estimates 88% of the time.

Other articles to look out for on Seeking Alpha:

Pepsico products pulled from Carrefour as retailer loses appetite for price hikes

Masking returns to some U.S. hospitals amid rising COVID, flu cases

Microsoft may soon supplant Apple as world's most valuable company

Major market averages ended Thursday’s trading session with another downward move after Wall Street received some additional jobs data.

The Nasdaq ( COMP.IND ) was the worst performer as it closed lower by 0.56%. The S&P 500 ( SP500 ) concluded lower by 0.34%, and the Dow ( DJI ) finished slightly higher, near even.

Three of the eleven S&P sectors were able to pull together gains as the market was led by Health Care and Financials. On the other side, Energy was the worst performer as oil ( CL1:COM ) dipped by 0.8%.

U.S. Treasury yields pushed upwards. The 10-year yield ( US10Y ) rose 8 basis points to 4.00%. At the same time the 2-year yield ( US2Y ) rose 5 basis points to 4.38%.

Now let’s take a look at the markets as of 6 am. Ahead of the opening bell today, Dow, S&P and Nasdaq futures are in the red. The Dow is down 0.2%, the S & P 500 is down 0.2% and the Nasdaq is down 0.3%. Crude oil is up 0.5% at more than $72 per barrel. Bitcoin is up 1.4% and above $43,000.

In the world markets, the FTSE 100 is down 0.8% and the DAX is down 0.8%.

The biggest movers for the day premarket: Building on Thursday's gain of 14%, Peloton (NASDAQ: PTON ) is up another 2.6% premarket after the fitness platform announced an exclusive partnership with ByteDance-owned video hosting service TikTok.

On today’s economic calendar:

• 8:30 a.m. The U.S. jobs report for December will be released. Economists forecast 170K job additions for the month and expect the unemployment rate at 3.8%.

• 1:30 p.m. Richmond Federal Reserve Bank President Thomas Barkin to speak before the Maryland Bankers Association.

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