Mid-Morning Look

Tuesday, August 12, 2025

Wall Street cheered on Tuesday as a moderate rise in consumer prices in July left intact the case for a Federal Reserve interest-rate cut in September. The consumer price index rose 2.7% in July y/y, the Labor Department said in its monthly report, the same pace as in June and a touch cooler than the 2.8% that economists had expected. Fed funds futures continued to be priced for Fed rate cuts in September and December. The core CPI, however, which excludes food & energy rose 3.1%, above consensus and prior results. December gold pared overnight losses back to $3,400 initially after the CPI report but has since moved back to lows of day -0.7% at $3,380. Overall, a strong reaction for U.S. stocks post CPI, with 9 of 11 S&P sectors higher (Materials, Financials, Energy and Communications all up around 1%) as Smallcaps outperform on the rising hopes of Fed rate cuts in September and forward months. Markets overlooking signs of slowing growth as major brokerages, including Goldman Sachs, J.P. Morgan and Morgan Stanley, have forecasted slower global growth for late 2025 due to economic uncertainty fueled by tariffs and geopolitical tensions. The U.S. economy is expected to grow between 1% and 2% this year, according to estimates from leading brokerages, as tariffs push prices higher, while softening labor markets help avoid a potential wage-price spiral. But U.S. equities have risen over 30% since hitting their lows in April following President Donald Trump’s ‘Liberation Day’ tariffs. Right now, momentum remains to the upside and fear absent as the Vix falls -6%.

• In Crypto: Stablecoin issuer CRCL reported Q2 revenue and reserve income grew 53% y/y to $658M thanks to a jump in the interest it earns from the cash and short-term investments backing its USDC stablecoins; while reported a net loss of (-$482M) primarily due to two non-cash charges related to its IPO; MARA signed an investment agreement to acquire a 64% stake in Exaion, a subsidiary of EDF, for approximately $168M in cash. The deal includes an option for MARA to increase its ownership to 75% by 2027 with an additional investment of about $127M, contingent on meeting certain milestones. BMNR shares jumped early with bounce in Ethereum yet again above $4,400, but slip as files to sell common stock of up to $20B.
• In Transports: Shares of U.S. airlines climb early (AAL, DAL, UAL) after data shows air fares climbed 4% in July, compared with a 0.1% fall last month; in truckers, FWRD shares active following earnings results; in rails, UNP was downgraded to Hold from Buy at Argus following the recent merger with NSC and notes the company faces export challenges amid tariffs.

• HBI +23%; as Financial Times reported GIL is close to a deal to buy them, potentially valuing the co at about $5B, including debt. The deal talks are at an advanced stage, and an acquisition could be agreed by the end of the week, but the talks are not finalized https://tinyurl.com/y3k7b9uz
• LIF +10%; reported a Q2 beat and raise with revenue and EBITDA, respectively, coming in $5.2M (~5%) and $6.9M (~52%) above consensus, while raised its full year outlook, increasing revenue guidance by ~2% and EBITDA by about 10% (adding approximately $7M to revenue and EBITDA).
• LQDA +11%; as Q2 revs $8.84M topped the consensus $4.05M saying its inhaled drug to treat blood pressure, Yutrepia, surpasses 900 patient prescriptions and 550 patient starts within 11 weeks after FDA approval.
• MRCY +16%; following a beat and raise Q2 as adj EBITDA $51.3Mm vs est. $34.3Mm on revs $273.1Mm vs est. $245.4Mm; Raymond James upgraded MRCY to Strong Buy (tgt to $80 from $55) saying Mercury cold be the biggest margin story in the defense space.
• ONON +8%; after posting a 6.5% increase in Q2 revenue and a smaller-than-expected adjusted loss, while gross profit margin rose to 61.5% and raised its full-year guidance on net sales and profitability and annual adjusted EBITDA margin 17%-17.5% vs. prior view of 16.5%-17.5%.
• SBGI +13%; after CNBC reported the co is exploring merger options for its broadcast business and is also looking to separate or spinoff its ventures business – CNBC https://tinyurl.com/yjs6vyuz
• SE +18%; after the e-commerce company reported Q2 revenue that beat the average analyst estimate while adjusted Ebitda and e-commerce revenue also beat estimates; Q2 adj Ebitda $829.2M vs. est. $804M; Q2 revs $5.26B vs. est. $5.12Be; said expect Shopee GMV growth momentum to carry into Q3.
• WOW +48%; after saying it entered into a definitive agreement where affiliated investment funds of DigitalBridge Investments, LLC and Crestview Partners will acquire all of the outstanding shares of common stock for $5.20 per share in an all-cash transaction in deal valued at $1.5 billion.
• ZIP +13%; 2Q revenue and EBITDA beat, 3Q guide brackets consensus, and the company sounds confident that a return to positive revenue growth in 4Q; reported Q2 adjusted EBITDA $9.3M vs. est. $7.4M; Q2 revs $112.2M vs. est. $111.7M; announces new $100M buyback authorization.

• BBAI -28%; shares fell after Q2 results disappoint; Q2 revs of $32.5M were well below the Street $41.0M estimate while lowering its full year revenue guidance to $125.0M-$140.0M, down meaningfully from $160.0M-$180.0M, previously amid revenue and disruptions in federal contracts.
• CAH -9%; said it will acquire Solaris Health for about $1.9 billion in cash to expand its specialty business while also reports Q4 adj. EPS of $2.08 per share vs. est. $2.04 on light revs $60.2B and raises its 2026 profit per share forecast to a range of $9.30 to $9.50, from its prior range between $9.10 and $9.30.
• CE -13%; reported 2Q EPS of $1.44, compared to consensus of $1.40 as the company beat in Engineered Materials, while missing in the Acetyl Chain; guided Q3 adj EPS $1.10-$1.40 below consensus $1.73 saying expects a softening demand environment across most key end-markets in the second half of the year.
• DSP -16%; as reported better Q2 results, though Q3 guidance came in below consensus expectations by approximately $3M, and EBITDA guidance was ~$2M below consensus as Viant was impacted by an agency partner losing a sizable advertiser client.
• FLNC -17%; after reporting Q3 total revenue $602.5M, which missed the average analyst estimate of $760M as the company saw slow US production and lower orders; also said expects to be at lower end of FY revs guidance range of $2.6-2.8B vs est. $2.758B.
• PUBM -25%; after reported Q2 revenue and EBITDA exceeded the high-end of guidance; however, headwinds from another major DSP partner drove Q3 revenue guidance 10% below consensus and EBITDA guidance to ~$6M below consensus.