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Today we are watching…
1. Raytheonย (#rayth)
The US government has cleared last Juneโs mega-merger between aerospace giantโs Raytheon and United Technologies. Itโs happening. The deal was signed at a time that promised two growth opportunities for war stocks, the Trump Administrationโs big defense spending, and the record plane orders from airlines. With travel frozen, one of those incentives has been destroyed in the short-term, explaining why both stocks fell on news of the confirmed merger on Friday.
2. The Cheesecake Factory (#cheesy)
The Cheesecake Factory is in a sticky situation. Nobody walks into an empty restaurant, and the American chainโs freefalling stock price serves as evidence of that. Investors have turned on the company as it furloughs 41,000 staffers and closes outlets everywhere. It just told landlords (who โthe factoryโ a favorite tenant) to shove those rental bills and expect nothing for months, and that could be a precedent set for the entire retail industry. Some investors are interested. If retailers unionize to avoid rent and the government sympathizes, that could be an unorthodox type of relief to get through this recession. Do they stand a chance?